WELCOME
Weekly selected highlights in flow control, treatment and combustion from the
many McIlvaine publications.
Briefs
Fugitive Emissions Summit:
This two-day conference June 26-27 will be held at the same time as the Pump
Summit in Houston. An exhibition on
both subjects will also be held. Bob McIlvaine will be there and looks forward
to discussing both subjects with one and all.
McIlvaine is covering fugitive emissions in its valves, pumps, and IIoT
publications but also in
202I Refinery Decisions.
To learn more about the conferences or to register click on
www.amercas.fugitive-emissions-summit.com
Air Pollution Management.
This service is explained at
5AB Air Pollution Management.
You can view the latest newsletter at
http://www.mcilvainecompany.com/brochures/newsletters/gdnl480/gdnl480.htm
Latest News Releases
$20 billion Market for Cartridges by 2024
Power Industry will Spend over $1.5 billion for Gas
Measurement in 2022
$180 billion Market for Combust, Flow and Treat for
Gas Turbines
Power Plant Cross Flow Membrane Revenue Opportunity
to Exceed $1.2 billion by 2025
Accurate Forecasting of the Combust, Flow and Treat
Markets Would Cost $2 billion
Top 25 Pharmaceutical Companies will buy 45 Percent
of Cleanroom Consumables
Is 3M Leading the Way to IIoT for Industrial Filter
Suppliers?
Customer Based Sales of Combust, Flow and Treat Products
There is a sea change in the market for combust, flow and treat (CFT) products.
Navigating that change is going to be challenging but it can be
accomplished progressively with immediate returns to offset costs.
If you sell high performance CFT products you will need a business program which
is oriented around large corporate customers and not around sales leads. This
program can be implemented one customer at a time.
If you start with the low hanging fruit the program will be
self-supporting. Here are the details.
Sea change:
The sea change is occurring rapidly because:
·
Most CFT products are or will be considered high performance (initial price is
less important than performance).
·
CFT purchasers are merging and consolidating purchasing and selection decisions
in central corporate operations.
·
The corporate staff is employing remote O&M and data analytics to determine the
total cost of ownership of each product in each process.
·
The Industrial Internet of Wisdom (IIoW) is empowering the corporate staff to
validate the lowest total cost of ownership for each product in a process in
each plant.
The challenge:
It will be necessary to persuade a knowledgeable corporate staff that the
suppliers product has the lowest total cost of ownership for a specific process.
This in turn requires knowledge of the customer's processes and a
mechanism to convey this to the decision makers.
The progressive approach:
This sea change can be navigated one customer at a time as follows.
·
Pick the customer based on
o
Size of the revenue potential
o
The total cost of ownership advantage of the supplier product
o
Sales experience with this customer
·
Organize the campaign
o
Coordinate the regional and corporate sales, engineering and other personnel in
the most effective manner.
o
Interface with the customer based on knowledge of his processes and valid total
cost of ownership analyses which takes into account the site-specific factors
for each plant.
The McIlvaine company has a program which will provide you with cost effective
support for this campaign. This
includes forecasts of CFT purchases for the 1000 corporations who will buy most
of the CFT products, details on the plants and projects and the building blocks
for lowest total cost of ownership validation (LTOV). This includes general
factors such as country by country electricity costs but also knowledge of many
of the most important processes and the performance of CFT products in those
processes.
A free webinar can be arranged to discuss a progressive program.
Just contact Bob McIlvaine at 847-784-0012 ext. 112 or
rmcilvaine@mcilvainecompany.com.
Which Pump Purchaser to Target First?
The sea change in the market for pumps will require prioritizing corporate
prospects and then initiating a program for each on a progressive basis? Which
is the best first target? Here are the criteria.
Size.
The top 3000 purchasers are buying most of the high-performance pumps
(performance is more important than initial price).
Their average purchases are $7 million.
However the top 50 each purchase over $50 million per year.
The largest is Sinopec with purchases of over $800 million per year.
Gaining a market share of 10% with any of these 50 companies could
therefore add revenues of $5 to $80 million per year. So any of the top 50
prospects would warrant significant effort.
|
Pump Purchases in 2018 |
||||
|
Company |
Type |
Corporate Location |
Industry |
Pump Purchases
$millions |
|
Sinopec |
Operator |
China |
Oil & Gas |
607 |
|
Sinopec |
Operator |
China |
Chemical |
108 |
|
Sinopec |
EPC |
China |
All |
90 |
|
Sinopec |
Total |
China |
Multiple |
805 |
|
NTPC |
Operator |
India |
Power |
224 |
|
EDF |
Operator |
France |
Power |
220 |
|
Eskom |
Operator |
South Africa |
Power |
192 |
|
Bechtel |
EPC |
U.S. |
All |
320 |
|
BASF |
Operator |
Germany |
Chemical |
157 |
Product Fit
There are a number of different pump types. Each is available in multiple
materials depending on the service.
A pump company specializing in exotic alloy pumps would want to focus on
industries such as chlorine manufacture where exotic alloys are required.
Here are pump purchases for the top chlorine manufacturers.
|
Chlorine Producer Pump Purchases
$ millions - 2018 |
||
|
Company |
% |
$ |
|
Total |
100 |
300 |
|
Olin |
6 |
18 |
|
Oxy |
4 |
12 |
|
Formosa |
3 |
9 |
|
Dow |
3 |
9 |
These are just purchases for chlorine service. All these manufacturers also
purchase pumps for processes using chlorine, as well as for power, water,
wastewater and cooling. For these
specialized applications it is possible to achieve high market shares.
A 30% market share at one company can result in revenues of more than $5
million/yr.
There is lots of differentiation in materials to withstand corrosion,
temperature and erosion. Manufacturers are willing to spend whatever is
necessary to minimize leaks of dangerous acids. The company which can provide
the lowest total cost of ownership validation (LTCOV) can capture a large market
share.
Sales Fit
The corporate office is likely to be the primary decision maker but local sales
and service will also be important. If you have strong sales and service support
in the Americas you will want to consider that the second largest purchaser in
the food industry (ADM) buys 66% of its pumps for the Americas region.
IIoT Newsletter
This monthly newsletter is available separately or as part of
N031 Industrial IOT and Remote O&M.
Here are the headlines for the latest issue.
MARKETS
INDUSTRY NEWS