NEWS RELEASE DECEMBER 2014
The New Approach to Market Forecasting For Flow Control and Treatment Products
Traditional forecasting of markets for air, gas, water and liquid flow control and treatment products has been the top down approach. The total market is determined and then segmented by industry, product and location. There are two problems with this approach:
- The numbers are not reliable
- There is not the granularity needed to set quotas and promotional expenditures
The bottom-up approach is far better. The problem is that it is necessary to determine the quantities in as many as 50,000 niches. Prior to the digital age this was prohibitively expensive. Today it is a money saver. The granularity offers the potential to make a decision about selling an on/off ball valve to the pharmaceutical industry in Germany as follows.
|
Question |
Answer |
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What is the valve growth projection for Germany? |
Valve growth over the next five years will be $140 million from present $1.9 billion. |
|
The biggest potential for the new valve is pharmaceutical. How big is this market? |
Will grow by $4 million to $61 million/yr by 2019. |
|
The product is a globe valve, so how big is this segment? |
German pharmaceutical globe market will grow by $1 million/yr to $15 million in 2019. |
|
It will primarily be used for on/off and not control, so how big is this segment? |
On/Off market will grow to $13 million by 2019. |
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The new valve is used mostly in processing and not water, so how big is this segment? |
Processing segment is 60 percent for a 2019 market of $7.8 million. |
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What will be the sales for new plants? |
Only 30 percent or $2.3 million. |
|
The new product should capture 15 percent share. |
Target is $345.000/yr by 2019. |
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Should capture 5 percent of the replacement market which is 70 percent. |
Target is 70 percent of 7.8 million x 5 percent=$273,000 for a total annual sales of $618,000. |
These detailed forecasts provide the unique opportunity to validate the accuracy of the forecasts for the total market. Who better than the local salesman to evaluate the forecast for his products and its reliability.
McIlvaine has this level of granularity in:
N064 Air/Gas/Water/Fluid Treatment and Control: World Market
N029 Ultrapure Water: World Market
N028 Industrial Valves: World Market
241I Nuclear Power Plant Valve Forecast and Analysis
N026 Water and Wastewater Treatment Chemicals: World Market
N031 Air and Water Monitoring: World Market
N024 Cartridge Filters: World Market
