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Understanding Industrial Markets

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Text of Understanding Industrial Markets

  • Understanding IndustrialMarkets :Its Nature, Systems andEnvironment

  • Value Chain FlowRaw Material, Spare Parts and Semi finished MaterialSale of Capital Goods, Supplies andConsumer Goods to Households,Govt., Business & Insts. And Exporters ManufacturingIndustries

    OEM --- Other Indust.

  • Nature of Industrial Marketing

    Three Broad Divisions of Economy

    ManufacturingAnd AlliedIndustriesConsumingUnitsExtractiveIndustries

  • Product Flow Diagram

    ManufacturingAnd AlliedIndustries

    Manufacture/Setup/Create/Sale toOtherManufactures

    ConsumingUnits

    Households

    Govt.

    Other BusinessUsers

    ExportersExtractiveIndustries

    Farms

    Mines

    Forests

    Fisheries

  • ENVIRONMENAL TIERSInternalCustomersCompetitorsIndustryMacroMacro

  • Types of Environment

    Ecological and physical - Air and Water Pollution - Solid Waste Disposal - Conserving Natural Resources Internal External - Micro - Macro

  • MICRO / MACRO ENVIRONMENTCOMPANYNew EntrantsSuppliersSubstitutesRival FirmsBuyers

  • Governments Role

    Regulating Agencies Laws / Policies Programme Funding Research Funding Import / Export Regulation Levying Taxes Controlling Interest Rates Providing Social Programmes

  • Environment Scanning

    Gathering and Monitoring Information On Customers and Competitors through Marketing and Sales Staff Analyzing Trade and Govt. Publications Carrying out Market Research and Market Forecasting

  • Environment Monitoring

    Understand Changes in Customer Needs Monitor Competitors Actions and Strategies Identify Technological Innovations Changes in Govt. Policies, Laws Changes in Major Customers and the Total Market Changes in Environmental Factors

  • Gordon E.Miracles Qualitative CategorizationCost of ProductVL L M H VHSignificance to The BuyerVL L M H VHTechnical ComplexityVL L M H VHTechnological Change FrequencyVL L M H VHAfter Sales Service VL L M H VH

  • Gordon E.Miracles Qualitative CategorizationPurchase FrequencyVL L M H VHSpeed or Rate of UsageVL L M H VHVariety of Needs to be SatisfiedVL L M H VHExtent of Efforts to Get the ProductVL L M H VH

  • Some Examples

    Very Low Iron Ore, Coal, Lime Stone Low Alumina, Pig Iron, Kerosene Oil Medium Tire and Tubes High Motors, Compressors, Pumps, Bulldozers Very High Fork Lifts, Lathe Machines, Fabricated and Capital Equipments, Software

  • Classification of Industrial Products Major Equipments and materials Accessory Equipments Fabricating or Component Parts Process Material Operating Supplies Operating services

  • Major Equipments and Materials Large Machines or Other Tools Charged to Capital Account

    Two types :-Multipurpose or Standard machines example Dyes in Stamping MachineSpecial Duty or Single Purpose Machine : Grinding Machine

  • Accessory Equipments Machinery used in Auxiliary Capacity Cost is Generally Charged to Current Expenses Horizontal Demand Small lathe Fractional Horse power motors Small Tractors Fork Lifts

  • Fabricating or Component Parts

    The work is carried on by a series of plants, often under diverse ownership, each performing a single operation or homogeneous group of operations on the material.Example:- Batteries and tires in automobile industry

  • Fabricating or Component Parts

    On the Basis of Specifications Long Term Supply Commitment Uniformity and Reliability of Quality Strict Delivery Schedule Retain Their Identity in Finished Products Large Replacement Market

  • Process Material Form an Un-Distinguished Part of Finished Product Broken up and Dissipated in the Production Process Catalyst Binding agents Flavours Preservatives

  • Operating Supplies Do not Become Part of Finished Product Continuously Worn out or Used up Needed by Many Different Industries Bought in Small Quantities Purchased in a Routine Manner Standardized MRO (Maintenance, Repair and Operating) Items

  • Operating SuppliesPaintsSoapsOilsGreasesPencilsType WriterStationary paper etc

  • Operating services

    Building Maintenance Auditing Legal Services Courier Services etc

  • Major Industrial Suppliers

    Machine Tool Manufacturers Mill Industries Steel, Aluminum, Pulp, Copper Processing Plants, Refineries Fabricators, Spare Part Suppliers Industrial Service Organizations

  • Thank You

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