Vision33 BlogSAP Business One Blog for SMEs

As the quality of overseas metal pipe and valve imports catches up to those manufactured domestically, there’s been a shift in end user buyer behavior. Companies that once purchased quality metal pipe and valve components manufactured in the U.S. are increasingly turning to cheaper overseas suppliers. Today, pipes and valves imported in the U.S. accounts for 40% of total sales in the country. Now more than ever, PVF distributors are having greater difficulty forecasting sales when end users’ purchase decisions (like in other standardized commodity-based markets) are subject to price fluctuations of supply and demand. This presents an interesting management challenge: How can a PVF distributor generate better sales pipeline for their products while contending with market pressures that often favor low-price options from oversea markets?

Talk about pressure; the U.S. pipe and valve industry is very concentrated, with 50 manufacturers representing more than 65% of the revenue generated by the industry. What’s left is a very competitive landscape noted for its acquisitions and mergers. And while most PVF components are standardized, built to stock products, it’s in this market segment where you’ll also find innovative. In a bid to resist the pressures of commoditization and intense competition, pipe valve and fitting manufacturers are devising new ways to add value to their product offerings to stay competitive. Here’s a few of the key ways you can stay competitive too: