08272016Sat
Last updateThu, 25 Aug 2016 4pm

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Valve Basics Training Helps Fill Industry Skills Gap

Valve Basics Training Helps Fill Industry Skills Gap

One of the most keenly felt needs in tod...

An End-User’s Perspective on Valve Selection and Risk

An End-User’s Perspective on Valve Selection and Risk

I am not a valve expert, although I ofte...

New Test Stamp and More Updates on Pressure Vessel Codes

New Test Stamp and More Updates on Pressure Vessel Codes

A new test organization program and stam...

The Role of Valves in HAZOP Studies

The Role of Valves in HAZOP Studies

Process hazard analysis (PHA) is require...

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ValvTechnologies Successfully Completes NUPIC Audit

2 DAYS AGO

ValvTechnologies, Inc. recently achieved NUPIC-approved suppliers list status, upon successful completion of the Nuclear Procurement Issues Committee (NUPIC) audit conducted at the Houston facility. NUPIC members include all domestic U.S. nuclear utilities as well as several international members.

Form...

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GE Oil & Gas Supporting ONGC’s Exploratory Drilling Campaign in India

2 DAYS AGO

GE Oil & Gas has been awarded a multi-million-dollar frame agreement by Oil and Natural Gas Corporation Limited (ONGC), India’s largest exploration and production company. Under the agreement , GE will provide an estimated 55 subsea wellheads (SG5) over next three years for the operator&rsqu...

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Chemical Activity Barometer Suggests Accelerated Business Activity

3 DAYS AGO

The Chemical Activity Barometer (CAB) expanded 0.4% in August following an upward revision for July. This marks the barometer’s sixth consecutive monthly gain. Accounting for adjustments, the CAB is up 3.2% over this time last year, the strongest year over year growth since January 2015. All d...

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Innovation Could Lead to Significant Cuts in Chemical Manufacturing Energy Use

3 DAYS AGO

Scientists from ExxonMobil and Georgia Tech have developed a new technology that could significantly reduce the amount of energy and emissions associated with manufacturing plastics. If brought to industrial scale, this breakthrough could reduce industry’s global annual carbon dioxide emissions ...

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Manufacturing Productivity in U.S. Higher Than Other Nations

1 DAY AGO

“U.S. productivity unexpectedly declined for a third straight quarter in the three months through June, Labor Department figures showed. On a year-over-year basis, it fell for the first time since 2013,” Bloomberg reports .

But on a more positive note, “the U.S. still blows other natio...

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Durable Goods Orders Up 4.4%, a Six-Month High

1 DAY AGO

New orders for manufactured durable goods in July increased $9.7 billion or 4.4% to $228.9 billion, the U.S. Commerce Department announced. This increase, up following two consecutive monthly decreases, followed a 4.2% June decrease. Excluding transportation, new orders increased 1.5%. Excluding def...

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2009 Market Outlook: Riding Out The Storm

The atmosphere at VMA's Annual Market Outlook Workshop, held Aug. 14-15 in Boston, was more somber than in years' past as attendees-primarily manufacturers of valves, actuators, controls and pumps-listened to speaker after speaker predict continued, even worsening, troubles in the economy, in the United States and around the world.

 

Still, there were a few bright spots among the gloomy news: The power industry in general will remain strong, driven globally by the world's increased need for energy and affected here in North America by the need to tap into new and existing alternative energy sources. Nuclear in particular appears poised to take off in the U.S. as the general public, legislators and other policy-makers accept that nuclear can be a safe, cleaner way to get power. And for the short term, the upstream oil and gas marketplace is actually doing better than predicted a year ago as a reacceleration plays out that may well last into 2009.

Most left knowing that darker times may be coming, but that the North American valve industry has "been there, done that," and with proper preparation and knowledge about new markets and opportunities-global and domestic-their companies can survive this inevitable downturn and come out the other side stronger than ever.

Here's what our speakers had to say:

DOMESTIC ECONOMY
Yes, the Recession is Still Coming

Many people who attended past forecasting conferences were anxious to hear what Alan Beaulieu, economist with the Institute for Trend Research, had to say-not just because he's an entertaining speaker, but because his prediction last year for the U.S. economy was rather bleak-a good 2008, but a recession by 2009.

As far as 2008: "I'm glad you've been enjoying the year," Beaulieu joked, "but the U.S. is softening. Everything you heard in the first half of 2008-all that concern-was just the band warming up."

"This time next year, we will be recognizing that we are in a full-fledged recession," he said. The same will be said in Europe and in China (whether that country recognizes it or not, Beaulieu commented).

Consumers will lead the parade into the downturn, he said, helped along in part by the fact that despite the current woes, we have had poor leadership in this country. For example: "We are a debtor nation. The richest nation on Earth but we can't pay our bills."

Inflation will be a major pressure, he added, because even though officials and experts say the core inflation rate is "only" 3 to 4%, that rate doesn't take into account energy and food. The Consumer Price Index, on the other hand, is 5.6%, which is high, he pointed out.

When people's budgets are hit as hard as they are being hit at present by food, energy and other daily needs, "they stop spending, and that brings a recession," Beaulieu said.

As far as other locations around the globe, "when the U.S. gets a cold, so does the rest of the world," he said.

Still, Beaulieu was not all doom and gloom.

U.S. industry is "doing wonderful things," he exclaimed. They are proficient in selling to the rest of the world, they have the most competitive work force in the world, and they have twice the output of the emerging giant China.

What it will come down to for industry is what's happening at the company level, he said. "If you are doing well, you have to ask: how can I prepare?"

Among his suggestions:

  • Help your margins by differentiating your company from competitors, and then let everyone who works for your company know how you're different.
  • Develop quantifiable reasons you are better than your competition. "What people want in a downturn is a metric. [They want to hear:]
  • 'I can fix this problem on the first go-around, and I can fix it in four hours, not six,'" Beaulieu explained. Clients want to know that quality is more than an adverb.
  • Consider taking on subcontract work if the backside of the cycle begins to look recessionary.
  • Begin missionary efforts into new markets.
  • Freeze expansion plans unless they are related to the logical next step for a particular company. If those plans are made just to expand the company's reach, rethink those plans.

When things start leaning into a recessionary cycle, Beaulieu suggested:

  • Begin reducing work forces. Don't tell employees that everyone will keep their jobs, but let them know most people will be okay-we've been through this before.
  • Set budget reduction goals by department.
  • Avoid long-term purchasing commitments.
  • Find a way to do business in the counter cyclical or unaffected areas (e.g. energy, travel, green, Canada/exports, higher education, healthcare, etc.).

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