NEWS RELEASE                                                                                         May 2018

Accurate Forecasting of the Combust, Flow and Treat Markets Would Cost $2 billion

Detailed and accurate forecasting of the Combust flow and Treat (CFT) market is very expensive.  A big investment cannot be justified just to ascertain whether a market could be promising. The casual inquirer can benefit from relatively inexpensive reports to indicate whether detailed study is desirable.  However, a supplier who should be basing his business plan around accurate forecasting can afford and should invest in the appropriate research.

A company with a superior dissolved oxygen monitor paid McIlvaine Company $100,000 just for a study relating to that device.  For just $4500 they could have purchased the McIlvaine IIoT and Remote O&M report with forecasts for control, guide and measure including a segment on liquid measure with 10,000 forecasts.  Rather than use the report to guesstimate the DO opportunity the company realized the value in the greatly improved accuracy of a focused report.  When you consider that this is just one of 20,000 or more niches in the CFT industry the cost for accurate forecasting of all segments would be more than $2 billion.

The McIlvaine Company has many published market reports on various aspects of the market for CFT hardware, consumables, and instrumentation.  These standard reports range from $3000 to $5000/yr and are continually updated. Some have been continually updated and revised for 40 years.  How accurate are they compared to alternatives?  The best evaluation tool is to chart the inaccuracy level   Actual/ estimate for both the total forecast and for a 1% segment for the various alternatives.

Over the last few years there has been a large increase in the number of reports available on CFT subjects.  Some are just extractions of investor presentations by CFT companies and they mix apples and oranges by combining forecasts for products which would seem to be part of one market (home furnace electrostatic precipitators vs industrial) but when lumped together are not valuable to purchasers.  These reports are therefore subject to a 400 percent inaccuracy level for the total numbers and infinitely large inaccuracies for a 1% segment.

Another category would be highly respected reports published every year or two and widely quoted by CFT companies in their investor presentations.  These reports are top down analyses with reliance on industry and government statistics plus interviews which give a consensus perspective.  One of the problems with consensus is that it can be wrong or inapplicable.   History books report that 20 million Chinese were killed by the Japanese in the early occupation years.  The truth is that this number was just fabricated as part of a publicity release to gain sympathy for the Chinese resistance.

One highly respected publisher of a CFT report was acquired by another.  The first revised report by the new company showed a Chinese market much higher than the previous report.  This is one of the risks of top down forecasting.  There may have been only a 20 percent difference in the world numbers but a 100% difference in the Chinese numbers. Nevertheless, these reports have an accuracy level high enough to make them valuable for the casual inquirer or for the advocate who is looking for a source to confirm the attractiveness of his plan.

Many firms commission management consultants to provide very detailed analyses of CFT subjects. These consultants can charge hundreds of thousands of dollars for one report.  The problem is that the most capable general consultants do not have the knowledge to execute bottoms up analyses.  No matter how many interviews are conducted the results are not going to be as reliable as can be accomplished with bottoms up forecasting.

The McIlvaine reports benefit from liberal inclusion of bottoms up forecasting but still include substantial top down forecasting to maintain a competitive price.  The question the would-be purchaser should ask is whether a 10 percent inaccuracy in the total numbers and a 100 percent or higher inaccuracy on a 1 percent segment is the right balance between cost and value.

Most suppliers have a Serviceable Obtainable Market (SOM) which is only a portion of the Serviceable Available Market (SAM).  Furthermore, many of their investment and management decisions will be built on their understanding of some of the 1 percent segments and not just the whole. These are the typical McIlvaine clients for custom research.  Projects are often based on a McIlvaine multi-client report as a foundation and then detailed investigation of selected narrow market segments to provide the actionable information needed.

The McIlvaine goal is to bring down the cost of bottoms up forecasting.  The Advanced Forecasting initiative is to determine all the bottom level intelligence in a manner which can be used for all detailed forecasting.  This means evaluating each process in each industry and determining the present and future use of each combust, flow and treat product. This has been accomplished for all CFT products in coal fired boiler markets based on determining the capacity in megawatts (MW) of each plant around the world. Then factors relating to the market per MW are created for new, replace and repair sub segments.   A similar effort has been made for gas turbines.

Mcilvaine has made great progress in other industries where the variation from plant to plant is minor. This includes semiconductors, pulp and paper, steel making and refining.  It is a greater challenge in mining, but it can be done by just segmenting by ore type.  The food and pharmaceutical industries are more challenging.

The bottom up understanding is most difficult to obtain in the chemical industry where there are large numbers of processes to crease a wide variety of end products. McIlvaine is approaching this segment by segment and has recently analyzed the processes and operators in chlorine, isocyanates, urea, nitric acid and fertilizers. The bottom level output is the projected capital and installed investment in each major plant in each industry segment. So, a company such as BASF has to be dissected based on its production of TDI as well as other major chemical products.

For more information on the multi-client market reports click on

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For questions about custom consulting contact Bob McIlvaine at This email address is being protected from spambots. You need JavaScript enabled to view it. 847 784 0012 ext. 112