NEWS RELEASE                                                                                   October 2023

Integrating the MPM and CRM Systems

Major tools for business strategy and tactics are consultants and CRM systems. Top management, with periodic guidance from consulting companies, forecasts the markets and plans accordingly. These forecasts are not granular but assumed to be accurate.  Granular forecasts are made continually by the sales force who has to decide day by day where to spend its time.

The imperfections in the system result from the reality that top-down forecasts are just guesstimates. So are the estimates of each salesman.

There is the assumption that AI and CRM systems will resolve these imperfections. The reality is when you aggregate and iterate guesstimates the output is more guesstimates.

These imperfections can be eliminated with the Most Profitable Market (MPM) Program which not only provides reliable niche forecasts but the details the salesman needs. It can be incorporated as a major feature of your CRM system.

 A prevailing school of thought is that with diligent communications by your salespeople plus sales lead services opportunities will arise, which could otherwise not be predicted. The CRM system which gathers and analyzes these gems of knowledge is considered the most viable option for identifying opportunities.

In the air, water, energy markets there is another option. Factors can be leveraged which make reliable prediction economic.

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  • Less than 1% of air, water, energy product sales are to companies which do not have similar products in operation.
  • It is most likely that the product will replace an existing product.
  • Unless you have a monopoly, it is likely it is a competitor’s product which will be replaced.
  • Product life is predictable.
  • Most products are purchased by large companies.
  • The number and size of components can be determined for any process.
  • Due to government regulations, details on each process in each plant routinely appear in permits to operate.

The Most Profitable Market (MPM) program is structured around niche superiority.  Each niche is pursued separately. While an analysis to determine the location of each valve or pump in the food industry is not practical, it is possible to determine their locations for chocolate manufacture or beet sugar.

The market is shaped more by product life than by industry expansion. Since the sales approach differs between the two it is very important to determine the mix. The following ratios are the percentage of the installed base which will be purchased next year.

RATIOS AS A PERCENT OF INSTALLED BASE

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On average the replacement of competitor products is 2.5 times bigger than products for industry expansion.  The MPM program is well suited to predicting specific competitor replacements.

NEW VS REPLACEMENT
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Regardless of whether the expansion is onsite the MPM program is valuable. This is because only a small percentage of onsite expansions are where the supplier has installations.  Since most of the replacements involve competitor’s products the opportunities will not be in the CRM.

Here is the specific comparison between the CRM and MPM Contributions.

MPM CONTRIBUTION

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When the average factors are considered the MPM system is more than 3x more useful at predicting opportunities.

VALUE IN PREDICTING OPPORTUNITIES
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CRM systems have been very valuable in tactical pursuits. But certain aspects of the MPM program are also helpful in tactics and can be integrated. One is Value Propositions appearing in the Productivity Hub. Another involves articles appearing in magazines and linked from the Hub.

When the MPM and CRM program are integrated there is a flow of wisdom which improves both the MPM and CRM reliability and results in granular market forecasts being a  foundation for business strategy.

For more information on the Most Profitable Market click on www.mcilvainecompany.com

Bob Mcilvaine can answer your questions at 847 226 2391 or This email address is being protected from spambots. You need JavaScript enabled to view it.

NEWS RELEASE                                                                                   October 2023

Predict Customer Purchases in Each Niche

The Most Profitable Market program provides you with a game plan to pursue each tiny niche. It provides the revenue opportunity for a specific high-performance product.  It identifies the customers and the facts and factors needed to have a superior value proposition. It predicts the purchases over the next two years for any larger company in any state or country.  The key is selecting the most profitable market niches which include identifiable customers with the same need in the same geographical region or affiliation.

Here are some examples.

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Programs are available for all the products in fast growing markets such as hydrogen and fast-growing territories such as the semiconductor industry in Ohio.

For more information on the Most Profitable Market click on www.mcilvainecompany.com

Bob Mcilvaine can answer your questions at 847 226 2391 or This email address is being protected from spambots. You need JavaScript enabled to view it.

NEWS RELEASE                                                                                   September 2023

Lower Cost of Sales with Niche Market Forecasts

Niche forecasts and the focus on the most profitable ones is at the core of the Mcilvaine MPM program. It is detailed enough to be a sales guide and not just a reference. Production and purchasing also need the same level of detail or arguably even more. 

The salesman in S. California is targeting annual sales of diaphragm valves for biopharmaceuticals of $1 million. This includes a range of sizes. Niche forecasting by valve size is not very helpful to the salesman but is very important to production and purchasing.

The availability of this level of detail may sound like Utopia but it is already being guesstimated with each sales phone call and material purchase.

The Most Profitable Market (MPM) program replaces the guesstimates with reliable forecasts. These become the guide for the entire organization. They result in higher revenues and lower cost of sales.

Mcilvaine has been analyzing thousands of products in the air, water, energy markets in all the industries and countries for 49 years. It has created an Industrial Internet of Wisdom to evaluate new technical and regulatory developments.

There are two coordinated formulas for sales and production.

  1. Facts x Factors = Niche Market Forecasts x Value Propositions x Validation = MPM Maximum EBITDA
  2. Facts x Factors = Cost Forecasts x Manufacturing Options x Delivery Options = MPM Lowest Cost

Here is the structure from the sales perspective. pic1

Here is the structure from the cost control perspective.

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The Mcilvaine Most Profitable Market Program can be introduced one niche at a time.  Details on the program are shown at www.mcilvainecompany.com

Bob Mcilvaine can answer your questions at 847 226 2391 or This email address is being protected from spambots. You need JavaScript enabled to view it.

NEWS RELEASE                                                                                   September 2023

AWE Product Purchases are More Predictable Than Commonly Assumed

Why are sales predictable?  Because:

  • Less than 1% of air, water, energy product sales are to companies which do not have similar products in operation.
  • It is most likely that the product will replace an existing product.
  • Unless you have a monopoly, it is likely it is a competitor’s product which will be replaced.
  • Product life is predictable.
  • Most products are purchased by large companies.
  • The number and size of components can be determined for any process.
  • Due to government regulations details on each process in each plant routinely appear in permits to operate.

The Most Profitable Market (MPM) program is structured around niche superiority.  Each niche is pursued separately. While an analysis to determine the location of each valve or pump in the food industry is not practical, it is possible to determine their locations for chocolate manufacture or desalination.

The market is shaped more by product life than by industry expansion. Since the sales approach differs between the two it is very important to determine the mix.

pic1

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Sales of new products due to industry expansion are small compared to replacement sales. But it should be noted that the replacement might be a new plant replacing an existing plant.  The new plant could be in a separate location with a different company. But plant life is generally quite long. Many municipal sewage treatment plants have been in existence for many decades. There have been expansions and system replacements but at the same location.

In many cases the decision makers   for replacement product to an old system or selection for an on-site expansion will be the same, but this is not always true.  In large corporations with many plants, the replacement product decision is likely to be made locally.  Whereas for an onsite expansion the corporate staff or a systems provider may make the product decision.

The MPM market program dictates pursuing niches where 20% or greater market share can be obtained.  But this still means that a large percentage of the projects will be where a competitor has the advantage of bidding to replace one of his products. So, another part of this MPM is to create value propositions which show the superiority over the products in place.

This analysis has dealt with only hardware.  Consumables such as filter cartridges and chemicals are sold primarily for existing installations.  Dust collector filter bags could represent 30% of a new installation.  So, under a medium scenario the annual sales for new units and replacements would be 30% of .21 or 6%.the consumables replacement with a 2-year bag life and 20-year equipment life = 30%. In other words, the replacement bag market is 5 x greater than the bag market for new collectors.

Many equipment companies also sell the consumables.  So, their potential is even more predictable than the market just for the hardware.

For more information on the Most Profitable Market click on www.mcilvainecompany.com

Bob Mcilvaine can answer your questions at 847 226 2391 or This email address is being protected from spambots. You need JavaScript enabled to view it.

NEWS RELEASE                                                                                   September 2023

Where is the Trillion Dollar AWE Market Going?

The Air, Water, Energy industry should grow at a faster rate than GDP.  There is ample opportunity for unique solutions to unmet needs. On the other hand, the market is vulnerable to policies of governments around the world.

Sugar cane growers are involved in many aspects of air, water, and energy.  They make sugar with the help of liquid filters.  They can make ethanol and use residual waste to generate energy. They employ air pollution control systems to ensure clean operations.

Cane sugar is primarily produced in a few countries such as India and Brazil. So, sugar from cane is a microcosm of a very international industry investing heavily in rotating equipment, filtration, separation, drying, mixing, and combustion.

The market is international

The first principle in predicting the AWE market future is to understand that it is about as international as any market could be. The big coal producers are not the big iron producers who are not the big copper producers.  This has resulted in international companies who are the purchasers of AWE products.

Not surprisingly it takes international companies to best serve these international customers.

Power plant scrubber firms have been on a 40-year world journey. There was a $10 billion/yr. market in the U.S in the 80s followed a few years later in Japan.  By 1990 Europe was the major purchaser.  China was the big purchaser in the 2005-15 period.  Now India is peaking, and the growth is in S.E. Asia.

The environmental orientation drives internationalism

The AWE industry both is the cause and solution for CO2 emissions to the atmosphere.

Asia is adding more coal fired boilers than are being retired in the U.S. and Europe. But these plants could be greener than wind or solar by burning biomass and sequestering the CO2. Environmentalists now realize that BECCS achieved by converting coal plants is the only economically feasible carbon negative option.

 A very attractive carbon neutral option is to generate power in remote areas through solar or other renewable means and then use it to convert water to hydrogen.  This hydrogen in a liquid form or converted to ammonia can then be shipped anywhere.

AWE companies are so international that the corporate location can be misleading

It is a mistake to think of ABB as a Swiss or European company when it is comprised of very successful subsidiaries around the world.  Neway is a Chinese valve company but due to acquisitions has a strong presence in the U.S. and Europe. Many U.S. companies have set up manufacturing plants in China. The products are offered locally as well as to other countries in Asia. Export of components to the U.S. is also common.

Isolationist policies hurt the AWE industry

Policies such as the tariffs on Chinese imports may be good or bad for the U.S. generally but they are clearly bad for the AWE industry. They simply have added to the price of AWE products purchased in the U.S.

Support for the war in Ukraine is obvious for an international industry which benefits when territorial boundaries are respected.

Incentives to increase R&D needed

The U.S. tax policy which for a few years allowed companies to expense R&D rather than amortize it is expiring. This is particularly detrimental to the AWE industry.

Industry EBITDA is around 15% but should be 30%. It is an industry with rapidly evolving needs and therefore should be served by companies willing to take some risks to seize the opportunities. In general government subsidies for AWE research have failed.  Instead, success has come from small industry efforts such as the successful development of hydraulic fracturing of shale.

The conclusion is that the expensing rather than capitalizing of R&D will be a step in the right direction.

The future of the AWE industry should be bright if not dimmed by government policies.

For more information contact Bob Mcilvaine at 847 226 2391 or This email address is being protected from spambots. You need JavaScript enabled to view it.

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