Excerpt: Pipe of all types and sizes is critical in building, construction, chemical, energy, and other industrial applications. The pipe industry is expected to experience considerable change and varying growth rates in these uncertain economic times. The global export market of the steel pipes is stated to be close to $27 billion a year with the US, Western Europe, Australia, and Japan being the biggest importers. India is one of the major exporting nations including Indonesia, Malaysia and Thailand…
The building & construction industries along with the oil & gas sector are the major marketplaces for pipe. With the construction market booming and further development of new markets for steel pipes ranging from commercial framing to water pipes, the future of steel tubing industry certainly looks bright. Significant consolidation and rationalization of excess capacity has occurred in some segments, while cost containment and improved process and quality control measures have led to productivity gains and quality improvements across the entire pipe industry.
Source: http://www.steel-pipes-tubes.com/steel-pipe-industry.html
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Excerpt: Oil and Gas Field Machinery and Equipment Manufacturing Current ConditionsIn 2001 the value of shipments for the industry was estimated to be over $6.3 billion. Just as the oil and gas industry was recovering from the topsy-turvy events of late 1990s that saw prices swing widely, the industry was once again challenged by the political and economic conditions of the early 2000s. The terrorist attacks of September 11, 2001 pushed a slow downturn in the economy, beginning in early 2001, into a freefall, and the commercial and industrial sectors stalled out. Hoped-for recovery in 2002 did not materialize, and in December 2002 workers at Venezuela's national oil production facility went on strike, causing an upset in the U.S. import supplies of crude. On the heels of the strike came the U.S. war against Iraq, which briefly drove prices as high as $40 per barrel, before returning to the mid-$20 range. Global oversupply also threatened the industry's delicate equilibrium in the early 2000s. As a result of the turmoil within the oil and gas industry, oil field equipment manufacturing struggled, leading to a flurry of mergers and acquisitions. Despite the short-range difficulties, long-range predictions are positive for the industry, with slow but steady growth predicted into the 2010s. The world's peak oil-producing years are projected to be coming in the years 2020-2030, or earlier. Because the use of natural gas is on the rise in the United States, especially as a means to generate electricity, natural gas drilling services and supplies should also continue to be a viable market in the near to mid-range future. Industry LeadersThree dominant players in the industry are Halliburton Co., Schlumberger Ltd., and Baker Hughes Inc. The Halliburton Company, of Dallas, Texas had sales of $12.5 billion in 2002 and a net loss of $998 million. Halliburton has an assortment of divisions that provide a wide range of oil field services. Bariod Drilling Fluids, as its name implies, develops and sells oil drilling fluids for various applications. NUMAR, with its Magnetic Resonance Imaging Logging, measures the potential of new wells to produce oil or gas in commercial quantities. Security DBS supplies roller cone rock bits, fixed cutter bits, coring equipment and services, and downhole tools. Halliburton's purchase of Dresser Industries made Halliburton the world's largest supplier of oil field services. Prior to its acquisition by Halliburton, Dresser had sales totaling just under $7.5 billion in 1997 and a net income of $318.0 million. In 1997 Dresser had 31,300 employees. Baker Hughes had 21,500 employees the same year. Dresser Wheatley provides safety valves, flow control equipment, well screens, surface safety systems, as well as plunger pumps, liquid meters, and gas measurement equipment. Sperry-Sun provides drilling engineering services, tools, sensors, software for integrated systems, and rig site information services. 1999 revenues for Halliburton were expected to be in the neighborhood of $20.0 billion. Schlumberger Ltd. of New York likewise provides a variety of oilfield services and electronic measurement products. The company had sales of $13.5 billion in 2002 and a net loss of over $2.3 billion. The company has seven divisions that provide a wide variety of oil field services: Anadrill, Dowell, Geco-Prakla, Geo Quest, Integrated Project Management, Sedco Forex, and Wireline & Testing. By late 1999 Schlumberger was expected to spin off its offshore drilling unit, Sedco Forex Offshore, and merge it with Transocean Offshore. This merger would result in the creation of the world's largest offshore drilling company. The merger comes as a result of the high cost and high technological demands of offshore drilling. Baker Hughes was formed in 1987 when, amidst a global oil slump, Baker Oil Tools and the Hughes Tool Company merged. In 1998 Baker Hughes merged with Western Atlas to form the third largest oil field services firm which retained the name Baker Hughes. The bid was reported to be between $5.1 and $5.5 billion. The company makes oil field equipment and provides oil field services for drilling, completing, and operating oil and gas wells. Baker Hughes has nine divisions providing a wide variety of oil field services: Baker Atlas, Baker Oil Tools, Baker Petrolite, Baker Process, Centrilift, E & P Solutions, Hughes Christensen, and INTEQ. Baker Hughes has 26,500 employees worldwide and had 2002 revenues of $5 billion… Research and TechnologyThe oil and gas field machinery industry is also looking at exotic materials to enhance efficiency. A JIP between RTI Energy and Grant Prideco has produced and put into use a titanium drill pipe. The pipe is designed with high stress, short radius drilling applications in mind and is being used in Greeley County, Kansas. The titanium drill pipe, which is fitted with fatigue resistant steel tool joints, is resistant to chemicals and weighs half as much as steel with twice the flexibility. "In the oilfield services sector, the companies that succeed will be those that develop new technologies for increasing the efficiency and reducing the cost of producing oil and gas," stated a 1999 Standard & Poor's survey. The high cost of research and development is, however, expected to exacerbate the industry trend of continued mergers and acquisitions.
Source: http://www.answers.com/topic/oil-field-machinery
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Excerpt: The world oilfield equipment market is projected to increase 5.0 percent per year through 2012 to $70 billion. This will represent a significant deceleration from the 2002-2007 pace, when persistently high global oil and gas prices and rapid economic development in China and India combined to create a highly conducive environment for worldwide oil and gas drilling activity. The global economic slowdown and reduction in crude oil prices as of late 2008 will most likely also dampen oil and gas equipment sales for much of 2009. Nevertheless, growth should remain strong between 2010 and 2012, as heavily populated China and India continue to recover from a temporary slowdown and post robust economic growth. The most rapid growth in oilfield equipment demand through 2012 will occur in the rapidly growing oil producing countries of the developing world, including emerging oil suppliers in West Africa, Latin America and southeast Asia, which do not presently comprise particularly large markets, but hold significant potential. In addition, ongoing modernization of the vast Russian crude oil complex -- as well as those of other former Soviet states such as Azerbaijan and Kazakhstan -- will open up considerable opportunities for suppliers of oilfield machinery and equipment going forward. Iraq's oil and gas sector will also register strong growth as the country recovers from war. By contrast, maturity and declining output of fields located in the US, Mexico, the UK, Norway and elsewhere will work to suppress oilfield equipment markets in these countries, although there will be some opportunities in repair/maintenance and enhanced oil recovery activities. Finally, any number of countries in both the developed and developing worlds hold favorable prospects for natural gas production, which will stimulate some demand for oilfield machinery and equipment. Additionally, if prospects for oil and gas remain favorable, drilling activity for coal bed methane (CBM) and oil sands will continue to expand, especially in Canada, the US, Venezuela and China…
Source: http://www.allbusiness.com/mining-extraction/oil-gas-exploration-extraction-oil-oil/11749463-1.html
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Excerpt: According to the May 2009 Precision Metalforming Association (PMA) Business Conditions Report, metal forming companies expect business conditions to remain virtually unchanged during the next three months. Conducted monthly, the report is an economic indicator for manufacturing, sampling 142 metal forming companies in the United States and Canada. Metal formers anticipate general economic activity will decrease somewhat during the next three months. Nineteen percent of participants predict an improvement in overall economic activity (the same percentage reported in April), 46 percent expect that activity will remain unchanged (down from 54 percent last month) and 35 percent reported that activity will decline (up from 27 percent in April). Metalforming companies also anticipate a slight decline in incoming orders during the next three months… The number of metal forming companies with a portion of their workforce on short time or layoff decreased to 80 percent in May, down from 85 percent in April. This marks the first time since last summer that there has been a decrease—the number of companies with workers on short time or layoff had steadily increased from 17 percent in July 2008 to its peak of 85 percent in April 2009. "Orders and shipments in the metal forming industry generally slow down somewhat over the summer months, due to vacations and model changeovers in several markets, and this year is no exception," commented PMA President William E. Gaskin. "What is different this year is that significant portions of the automotive supply chain are operating at very low volumes and soft business conditions continue in virtually every other market as well…
Source: http://www.thefabricator.com/IndustryTrendsAnalysis/IndustryTrendsAnalysis_News.cfm?NewsID=2703
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Excerpt: As technological advances continue to make machinery more efficient and productive, manufacturers continue to invest in equipment — even in a down economy. In a world that is seemingly ruled by globalization, more companies are refocusing their efforts on productivity to compete worldwide. As machinery continues to boost productivity and advances in technology continue to make machinery ever more efficient, the United States Bureau of Labor Statistics (BLS) expects "output in machinery manufacturing to increase significantly" to meet higher demand. Demand for manufacturing machinery and technology is highly sensitive to cyclical economic swings. During periods of economic prosperity, companies tend to invest in new equipment to boost production; when economic growth slows, though, companies are understandably reluctant to purchase new machinery. Yet, even in the current down economy, companies are investing in manufacturing technology. Indeed, significant interest in manufacturing technology was shown last week, when the International Manufacturing Technology Show posted its strongest showing — with 92,450 total registrants from 119 countries and 1,803 exhibiting companies for the six-day event — since the 2000 show. But that's anecdotal evidence. With a year-to-date total of $2,655.14 million, however, consumption of manufacturing technology in 2008 is up 15.5 percent compared with 2007, according to the latest data from the Association for Manufacturing Technology (AMT) and the American Machine Tool Distributors' Association (AMTDA). In the U.S. alone, approximately 126,000 companies use machine tools, with about 2 million machine tools total. These companies have between 750,000 and 1 million directly related employees, including toolmakers, machinists, operators and programmers, according to the BLS. In fact, almost all midsize to large manufacturing companies periodically purchase machine tools. And if they're not buying, they're leasing. Machine shops are stable and machine tool leases are solid, according to the Agie Charmilles Machining Business Activity Index. In June, the 30-day delinquency rate on machine tool leases remained close to the lowest level on record, approaching 1 percent — much lower than the credit card or the home mortgage delinquency rate. And demand for machinery is expected to remain strong…
Source: http://news.thomasnet.com/IMT/archives/2008/09/demand-for-manufacturing-machinery-technology-expected-to-remain-strong.html
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Excerpt: Healthy revenue and profit margins are crucial to any company. However, monitoring your bottom line is only one part of the formula. It’s essential that you determine the factors critical to your company’s success, measure those metrics and put into place a system for continually improving performance. Here are ten guidelines for helping you develop your company’s process. 1. Define Your Goals: Determine your measures for success. Make your goals challenging, but achievable… 2. Determine the Metrics to Measure Your Company’s Performance: Compile a list of factors that are important in your industry. Criteria may include:
- Marketing…
- Production…
- Administrative…
- Management...
- Technology/Research & Development..
3. Develop Methods to Collect and Organize Data: Determine a process for tracking and reporting all relevant data… 4. Compare Yourself to the Competition: You can glean a lot by doing your homework, including shopping your competitors. Also check… 5. Conduct Research: When you need specific information about your customers and prospects that doesn’t exist, conduct your own primary research… 6. Understand Your Strengths and Weaknesses: Rate your company on your developed list of metrics in comparison to your competitors... 7. Focus on Customer Retention: Customer retention is a matter of business survival, as getting a new customer is five times more expensive than retaining a current one… 8. Measure Marketing Effectiveness: Effective measurement lays the groundwork for future plans, so keeping track of results is the only way to improve your marketing efforts… 9. Track Employees: Having top employees who are motivated is critical to your company’s success… 10. Apply the Information: Analyze the intelligence you’ve collected, draw conclusions and make recommendations based on it.
Source: http://www.stengelsolutions.com/tips14.htm
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Excerpt: Ways to Increase Market ShareThe market share of a product can be modeled as: Share of Market = Share of Preference x Share of Voice x Share of Distribution According to this model, there are three drivers of market share:
- Share of preference - can be increased through product, pricing, and promotional changes.
- Share of voice - the firm's proportion of total promotional expenditures in the market. Thus, share of voice can be increased by increasing advertising expenditures.
- Share of distribution - can be increased through more intensive distribution.
From these drivers we see that market share can be increased by changing the variables of the marketing mix.
- Product - the product attributes can be changed to provide more value to the customer, for example, by improving product quality.
- Price - if the price elasticity of demand is elastic (that is, > 1), a decrease in price will increase sales revenue. This tactic may not succeed if competitors are willing and able to meet any price cuts.
- Distribution - add new distribution channels or increase the intensity of distribution in each channel.
- Promotion - increasing advertising expenditures can increase market share, unless competitors respond with similar increases.
Reasons Not to Increase Market ShareAn increase in market share is not always desirable. For example:
- If the firm is near its production capacity, an increase in market share might necessitate investment in additional capacity. If this capacity is underutilized, higher costs will result…
Source: http://www.quickmba.com/marketing/market-share/
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Excerpt: When recession starts to bite, companies that tend to navigate the hard business climate through to the recovery successfully are good at several things. They focus on what they do well and keep doing it while at the same time they perceive an opportunity in hard business times when the competition is seeing shrinking margins and implementing cutback after cutback. The knee jerk reaction of your competitors frequently leaves large areas of the market unattended and though the overall economic situation may be bad, you will find isolated opportunities where the withdrawal of your competitors has left potential customers ripe for the picking… Review your marketing strategy but this is not the time to cut back on advertising and marketing campaigns. Particularly look at your trade show schedule and consider what cost savings you can make – this is always a good exercise no matter what the economic circumstances – but remember trade shows do work; they make money and they make profit so cutting back on them is not saving you cost it is costing you profit… Now consider whether trade shows have been working for you – if they do, now is the time to continue not cut back on your exhibition scheduling. There are things you can consider in terms of cutting the cost:
- Reduce the amount of space you rent;
- Reduce the level of staff manning the stand;
- Improve your marketing communications regarding your attendance at the trade show and maintain booth visitors;
- Improve your contact management system and ensure you maximize the potential from all leads and prospects generated at the trade show;
- Consider sharing space with a related but non-competing exhibitor;
Apply yourself and you will come up with a few others that are specific to your business but the guiding criteria on whether to cut the cost or not should be whether losing the cost will lose your access to market share or not… If you are in the B2B market, continuing your trade show schedule will be essential. If you cutback this sends out a message to all of your competitors and more importantly your customers who will expect you to have a presence. In this respect, trade show exhibiting is something of a business addiction in that attending is really about credibility as well as company promotion and sales. Using a trade show as your own business performance barometer is also an extremely useful aspect of continuing trade show attendance. You will not get a better opportunity to talk to your competitors and assess how well they are performing than under the single roof of a trade show. Even if you cut back on the actual booth cost and space rental, you should still attend trade shows in order to fly the company flag and you will still be able to enjoy the business networking opportunities that exist on the floor…
Source: http://showstopper.wordpress.com/2008/10/23/winning-market-share-in-a-recession-with-trade-shows/
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