Market change

The introduction of concentrated laundry detergent powders in Japan during 1986-1987 produced a substantial increase in the consumption of LAB in the subsequent 3-4 years as the market changed from low-density, spray-dried powders to the concentrated (compact) products. In these products, which may contain up to 40% surfactant, the cost/performance advantages of LAS are of significance. In addition, LAB sulfonic acid is well suited for the production of high-active, high-density (about 1.0 g/cm3) laundry powders by routes other... 

Figure 3.5 shows (using arrows only) some of the typical cash flows that might occur from the start to the end of a proposed plant. As the plant is built, the cash flows are negative, as is most likely the case during startup. Once in operation, the plant produces positive cash flows that diminish with time as markets change and competitors start up. Finally, the plant is closed, and eventually the equipment sold or scrapped. 

Of course, it is a fact of life that all companies, not least the water treatment service industry, need to have a sufficient level of new business every year. This is required to provide compensation for lost business, replace capital items, support market changes, and fund new developments. Thus, all service companies need frontline salespeople. 

Large water treatment companies, while perhaps not always having significantly better resources, obviously do have considerable depth in everything they offer. They also have the systems in place to respond to international market changes, and they undoubtedly come with enviable reputations. The top three or four water treatment companies in the world are known just about everywhere. Their representatives do not usually have any real difficulty obtaining appointments to visit new prospects. (Once inside the door, of course, they are just as reliant on their own personal skills and expertise as the small company representative is.)... 

Note Students sometimes complain that a project is not feasible at this stage and should be abandoned. However, the design team may not be fully aware of external developments, e.g. anticipated oil price rises, shortages of key commodities, etc. If a project does not appear feasible, it may be necessary to complete the design study in readiness for possible market changes and more favourable economic conditions. In this situation, it is preferable to perform the detailed economic evaluation (see Chapter 6) in terms of the changes in raw materials costs, increase in product price, etc., necessary to make the project profitable and feasible, rather than as a detailed statement of loss per annum. 

How have your perceptions of marketing changed after reading this chapter ... 

The economy is dependent upon the existence of technology. The job market changes as new technologies develop. 

The first large-scale application was the Phillips Triolefin Process (1966) in which propene was converted into ethene and 2-butene. Due to market changes the reverse process, in which propene is produced, became more attractive later. This process has been in operation since 1985. Another process is the Shell Higher Olefin Process (SHOP) in which ethene is oligomerized and the products are metathesized into detergent range olefins. The same company developed a process in speciality chemicals in which alpha-, omega-dienes are formed from cyclic alkenes. 

The minimum cost of feed pellets of seed cleanings is 40/T or 2.67/MBTU. Fuel pellets of bark are selling for 38/T delivered, 2.24/MBTU the sale price is close to our cost shown above. Direct cost of gathering and bringing field and forest residues to some point where they can be processed is between 1.50 and 2.40/MBTU. It appears that we must concentrate on the lower cost mill residues and wait for market changes to stimulate collection and densification of field and forest residues for industry. 

Figure 7. Market changes due to flammability concern residential upholstered...

Figure 1 presents a market change graph. From this figure, it can be seen that the numbers for lot size and repetitive order are decreasing, product life cycle is shortening, and product variety is increasing rapidly. 

---