Turning inventory has always been the key to the metal distribution game. After all, unsold 50,000-pound coils of steel can really clutter up a balance sheet, let alone a warehouse. Still in search of profits, today's hottest metals exchanges offer a lot more than the opportunity to buy and sell excess prime-grade steel. Some give access to prequalified suppliers whose inventory runs the gamut from tool steel to titanium. Others provide technical material specs and Web site design. Still more exchanges are railing out financing and shipping functions-even the chance to reserve time on a mill. (If they don't provide these services, forthcoming consortia of big industry players may turn them to slag.) We're not suggesting that you scrap the occasional tee time with customers, but 50 to 500 basis points for each transaction-and perhaps a small yearly subscription to a given site-is probably worth it to move those pesky coils.

E-Steel                                    (Private)
www.esteel.com
CHIEF EXECUTIVE: Michael Levin
MODEL: Marketplace
DESCRIPTION: Michael Levin's second attempt at a steel exchange. Users post material, send inquiries and haggle in private chat rooms. Cost: between 30 and 88 basis points per transaction. Plans to charge a monthly subscription fee and referral fees for financing and logistics services.
CLIENTS: 2,300 metal suppliers, including Ford Motor and USX Corp.
BUZZ: Working with First International Bank to automate credit delivery. Ford agreed to buy 4 million tons of steel products here.

MaterialNet.com                    (Private)
www.materialnet.com
CHIEF EXECUTIVE: David Centner
MODEL: Marketplace
DESCRIPTION: Youngest of metals' big three (including E-Steel and Metalsite), the company runs reverse auctions between buyers and brokers of coin -I semifinished products and raw materials. Example: A manufacturer enters a request for a quote and service centers bid against each other to win the order. Sellers pay a 1.5% to 5% transaction fee, based on volume. Materials include stainless steel, nickel and titanium.
CLIENTS: More than 400 metals suppliers.
BUZZ: Introduced its "Beat This Price" auction format, in which buyers set the opening price and commit to the purchase upfront.

MetalSite                                (Private)
www.metalsite.com
CHIEF EXECUTIVE: Patrick Stewart
MODEL: Marketplace
DESCRIPTION: Formed by Weirton Steel, LTV and Steel Dynamics, the site serves as a sealed-bid auction-style exchange, online catalog and information aggregator. It logs more than 5,200 transactions a month, charging between .25% and 2% for each. Offers carbon steel and some stainless steel. Monthly inventory: 150,000 tons.
CLIENTS: Bethlehem Steel, LTV, Weirton Steel.
BUZZ: Internet Capital Group bought a 35% stake from Weirton Steel for $180 million. In March MetalSite teamed with Metal Management and Philip Services to launch ScrapSite.Net, an exchange for steel and nonferrous scrap metal.

Metal Suppliers Online        (Private)
www.metalsuppliersonline.com
CHIEF EXECUTIVE: Alan Gamble
MODEL: Marketplace
DESCRIPTION: Generates 90% of revenues by charging a $500 yearly fee for its database of mill service-center and extrusion-shop inventories. Offers specs on nearly 17,000 steel and nonferrous grades. Builds Web sites for mills and metal centers and makes money from banner ads. Charges 2% to 5% for transactions.
CLIENTS: Timken, Admiral Metals, RTI International Metals
BUZZ: Gamble raised $1 million from angel investors and moved the operation from his bedroom to a 5,000-square-foot office north of Boston.