MARKET REPORT
The Benefits of Artificial Intelligence & Exhibition Participation in Valve Order Forecasting
The most profitable valve companies focus on the niches with the highest EBITDA . It is a straightforward approach , but difficult to execute 1 . Valve companies who create an Industrial Internet of Wisdom ( IIOW ) and actively create experts in continuously smaller niches , will find success . It not only involves demonstrating a low total cost of ownership but convincing the customer that it is lower than the competitors . There are product , location , and process ramifications for competitor assessments . Even more basic is a better definition of the market size .
By Robert McIlvaine , CEO – McIlvaine Company
Defining Total Market
What is the total market ? Is it number of valves in a certain size and application or is it the revenue ? The basic building block is volume adjusted revenues . This is the list price of one valve at world prices . Volume price discounts and the whole pricing structure in low-cost manufacturing countries , results in actual sales averaging worldwide at about 70 % of the volume adjusted revenue ( VAR ). The ideal way to determine the market is to add up the competitor ’ s sales and then compare it to the VAR . In a high manufacturing cost country , the actual revenues might be 80 % or 90 % of VAR . In a low manufacturing cost country , actual revenues could be as low as 70 % of the VAR . In addition to evaluating the performance of the competitors ’ product , it is desirable to determine the present market share and the investment being made to maintain the share .
Thanks to AI the exhibition analysis tool is now available . There are hundreds of
10 Valve World Americas | November 2024 • www . valve-world-americas . net