Rebranding a company is never easy, but sometimes necessary

Last week a Minneapolis industrial metals company underwent a long-planned rebranding, as Discount Steel got retired as a name and the company became known as Coremark Metals.

This wasn't an overnight task, of course, as there were apparently 452 items to redo.

There's something to learn here: not how the owners did this but why, as it seems to reflect a lot of good thinking about how to build a successful firm. Once being called Discount Steel made a lot of sense. Now Coremark Metals marks a big step forward.

It might be helpful to start by defining what's meant by a "brand." One way to define it is as a name or image that identifies a distinct business and says something to customers about what they can expect.

To understand where Discount Steel came from, you have to go back to its beginning in the summer of 1992.

Founder John Dormanen started working in the steel distribution business in Minneapolis as a high schooler and became a sales rep when he graduated. When his boss later died unexpectedly, Dormanen, with encouragement from his wife, Diane, decided to launch a business of his own.

Dormanen, with lots of contacts among steel suppliers as well as customers, had a business plan based on buying the steel business equivalent of scratch-and-dents, the steel that for some reason did not meet the specifications. His customers would be happy with the lower prices.

He called it Discount Steel, and the logo was a drawing of a worker who carried so many steel bars and pipes that all you could see were his legs and two hands. The two colors of the company's look seem to pretty closely match the home uniform colors of the Green Bay Packers.

Back then, "discount" clearly communicated its value to potential customers — here was a place to find stuff cheap.

"Discount Steel" is what's called a descriptive brand. While often helpful when a company launches, descriptive brands often turn into a problem, as explained by Dan Wallace, a marketing strategist and faculty member at the University of Wisconsin-La Crosse.

For one thing, Wallace explained, it's really tough to keep something like "discount" to yourself or try to trademark it. There are a lot of companies putting stuff on sale this week, including in the metals business. Another problem, of course, is that a brand like Discount Steel won't stretch as the company evolves.

That doesn't make launching a descriptive brand a bad idea, because more complex brands are much harder to market, particularly for startups without much of a budget. "Discount Steel" was a fine place to start.

When Diane Dormanen later came into the business to work, Discount Steel was already up to about 100 employees, even though John was still half the sales team and didn't have enough time to manage staff. As Diane described it, "we just revamped everything."

Diane Dormanen today is the president and CEO as well as co-owner. John is called founder and chief financial officer.

As Diane talked through what she cared most about, she kept coming back to culture. When she started, the company had more of a traditional, top-down style, and she flipped that on its head. Being a good manager now meant being a coach and collaborator, helping to improve performance.

Among the practices she described was profit-sharing for all 135 employees, with a check each quarter of the year and an extra one in December. Employees can track progress daily, with updates on video screens in the facilities.

One recent day, an electronic sign at the entrance said it had been nearly 3,000 days since a lost-time accident.

Curious himself, John Dormanen used his cellphone calculator to work out that it's been 7.96 years since somebody had to miss work due to getting hurt on the job.

What Discount Steel did for customers evolved, too, with more and more focus on service. The Great Recession was an opportunity to add new capability quickly, as laser-cutting machines that had been worth $1 million new were then available in the used market for $150,000.

The company now makes parts for production, filling orders of about 20,000 pieces. It also makes parts for prototypes and other high-service, custom jobs, both in Minneapolis and Fort Worth, Texas.

There is a strong temptation to leave things as they are when a business is performing well, but John Dormanen said he's known for a while that it was past time to rebrand. He felt lucky he had in Diane somebody who knew how to execute it, and she eventually hired the Minneapolis brand and design firm Capsule to help.

They also discussed branding with employees and customers.

Diane asked staffers to think about shipping a fragile and expensive family heirloom across the country. Would they choose Discount Delivery, or Platinum Delivery?

"And they all got it," she said. "We're selling to big companies, Lockheed Martin, Boeing. And Discount Steel … the name did not keep up with the business."

"It got to the point when we're embarrassed to give people our business cards," John added. "Because Discount Steel just didn't sound like the company we run."

Coremark Metals works as a brand for the owners in several different ways. To customers and employees, Coremark represents a business built on core values, and Diane would be happy to tell customers about Coremark values like compassion and reliability.

And they hope to leave their mark, with their employees as well as customers and suppliers.

Part of their plan included explaining what has not changed. The Dormanens still own the company, and prices aren't about to be jacked up. The retail operation they run, for DIY metalworkers, repair shop workers and the like, will still ring up sales that might not add up to a dollar.

And as on the day he started, John Dormanen added, "we will never say no to a customer."

lee.schafer@startribune.com • 612-673-4302