Abstract
Competitive Prices and Product Differentiation Should Revive a Mature
Market
Competitively priced high-end equipment with value-added features are
expected to be the key to penetrating the mature Western European metallic
welding and consumables market and offsetting stagnating demand and stiff
competition. Since the market is flooded with similar-quality welding equipment,
improving the price-performance ratio should allow manufacturers to
differentiate their products. For example, significant improvements in
performance, efficiency and power output of laser cutting and welding equipment
has widened the range of applications for the technology. Similarly, customized
equipment with improved product functionalities enable participants to enter
niche markets with the opportunity to gain higher premiums.
This Frost & Sullivan analysis comprehensively examines the Western
European metallic welding equipment and consumables market and various product
segments such as arc welding, resistance welding, laser cutting and welding, gas
cutting and welding, welding consumables, welding robots and other electric
welding equipment. The study presents extensive information on the latest market
trends, drivers and restraints across the main geographic regions and end-user
segments. Strategic recommendations are also featured to assist participants in
crafting a focussed marketing plan.
Welding Automation and Focused Service Offerings Present Opportunities for
Future Growth
The demand for easy-to-use automated welding solutions is intensifying as
high labour costs, a lack of skilled welders and the need for high precision
welding drive a shift towards welding automation. "This allows welding
equipment manufacturers to build closer working partnerships with customers as
well as expand revenues, since the capital cost of installing automated
equipment is higher," says the analyst.
Integrating services into a unique product portfolio is also critical to
sustaining market share. Strategies based on retaining customers reduce costs
significantly and generate opportunities to up-sell and cross-sell.
Installation, commissioning, maintenance, repairs and training must be packaged
with welding equipment to strengthen customer relations and increase revenues.
Strategic Alliances Stimulate Market Penetration and Long-term Success
"The danger of end-users' adoption of alternative mechanical joining
technologies combined with the prolonged economic downturn, means manufacturers
must focus on long term strategies that manoeuvre their business into a position
of sustainable growth," notes the analyst. "Since the current customer
base remains established, acquiring customers from the competition may be the
primary means to increase market penetration."
As raising market share becomes increasingly difficult, acquisitions and
mergers between large competing companies is expected to streamline operations
and magnify market standing. Leveraging mutual benefits complements the existing
product and service offering while creating opportunities to widen market
penetration. Smaller manufacturers may also opt for alliances with larger
competitors to harness the expertise, technical know-how and resources required
to sustain in the challenging environment.
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