Going green in the steel business

[SINGAPORE] Steel manufacturing has a negative image of being dirty, noisy and hard work. Hock Seng Hoe Metal Company wants to change this perception by going digital and going green.

The company was set up in 2009 as a steel reseller. In 2014, entrepreneur Sam Chee Keong invested in the business and became its managing director.

Within a year, it began stocking a wider range of steel items. Its sales team and overseas networks were reorganised, its systems went digital and it entered new markets – East Malaysia and Batam.

Sam built up the company’s range of value-added services to better serve client needs. Local delivery services were provided by an in-house team, while one-stop cutting or finishing services were provided in partnership with subcontractors.

All this helped Hock Seng Hoe become a more well-rounded centre for steel solutions.

In 2015, the company embarked on a six-year expansion plan. In the first three years, it focused on market segmentation, assessing the needs and potential of each segment. In the next phase, it moved into the shipbuilding and infrastructure industries.

Regional sustainability

Having developed a customer base in shipbuilding, the company is gearing up to expand its sustainable energy business, with its sights set on Vietnam and Indonesia.

With Vietnam as an up-and-coming market for offshore wind, Hock Seng Hoe aims to get into the construction of such infrastructure. Indonesia also has great potential for renewable energy, especially in hydropower, geothermal and solar energy.

In its sustainability push, Hock Seng Hoe is going into green steel.

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It has a strategic partnership with JFE Steel, Japan’s second-largest steel manufacturer and steel distributor. When JFE introduced its patented green steel product, Hock Seng Hoe was the first to import it to Singapore.

On its own premises, Hock Seng Hoe uses eco-friendly air-conditioning and LED lights; it has installed solar panels and is replacing diesel forklifts with electric ones.

Besides sustainability, the company has an eye on supply chain resilience. It switched from Europe-based suppliers to those in Asia, cutting shipping time by six to seven weeks and allowing it to diversify its sources through connections in China, South Korea and Japan.

Industrial transformation

Hock Seng Hoe has invested significantly in digitalisation to maintain its competitiveness. In 2016, it digitised invoices and upgraded its warehouse management system to improve inventory tracking, and to implement predictive buying for better productivity and efficiency.

Now, it is developing an artificial intelligence (AI) analytics platform, positioning itself as an early mover in demand and supply matching in metal distribution.

Meanwhile, its new digital distribution facility integrates tracking logistics technologies to quickly detect and fix errors in the warehousing system. The data collected helps to enhance predictive analytics capabilities.

The company is exploring a customer relationship management system to track customer enquiries and improve its ability to close deals.

Hock Seng Hoe works to upskill its staff, too, while encouraging them to share their concerns and opinions.

It has a buddy mentorship programme for new employees, and a management development programme that includes generative AI and sustainable manufacturing seminars.

“At Hock Seng Hoe Metal, we believe that only by upskilling employees’ capabilities will they be able to add more value to their job, and indirectly help the company be more successful,” said Sam.

This series is part of the Enterprise 50 Educational Project between the E50 partners and the NUS Business School. Hock Seng Hoe Metal Company was among the winners in 2023. The annual E50 ranking is co-organised by The Business Times and KPMG, sponsored by OCBC Bank, and supported by Enterprise Singapore, Singapore Exchange and Singapore Business Federation.