Comprehensive Innovation : Metal Fabrication Industry

Like all segment  of  manufacturing, fabrication business cannot survive stagnancy. There has to be a constant effort to improve and innovate. This is vital for survival since all technology driven businesses lose foothold and their vital customer base if they are not keeping abreast with the latest. 

The metal fabrication industry has faced innumerable challenges since last two decades to keep pace with the constant changes taking place. The innovation drive is comprehensive ranging from latest tools and equipment to management practices, IT system up-gradation and shrewd marketing strategies. 

As businesses move overseas to cut costs the customer base in North America and other developed World faces extreme reduction. Lets face the truth, access to overseas marketing is not an act of compassion or piety it is the need of the hour.    

Hence constant innovations and new developments are the key to survival. Things do not end here cost cutting by managing expenses considered affordable in good old days since these are no more sustainable. In short maximising efficiency without sacrificing quality is essential.  

To constantly evolve core business strategies, analysis and research though imperative need assistance of out of the box thinking. Both online or digital marketing and extensive land based strategies have to be employed.

Far from days of complacency, outsourcing has made industrial reach global mush to our chagrin. A disappointing development  but this is going to stay, there is no short cuts except face strict competition.  Possibility of trade barriers to provide relief is a distant dream because businesses moving overseas - to repeat is a strategy that benefits the parent companies. To face cutthroat competition the enterprise needs to be the fittest. 

Nevertheless competition is overcome by some resident factors like distance, availability of high grade manpower with requisite expertise and work ethics. Local fabricators will always retain these benefits.  Nevertheless extreme disparity in manufacturing cost could be a great lever. Back to square one.       

Creating a sustainable paradigm to for long term success is the imperative using constantly evolving technology and requisite skill base effectively. New skills in work force and access to and utilisation of  contemporary methodology will keep the pot boiling. 

Regular up-gradation of fabrication shops along with procurement of new equipment and tools is the key to stay afloat. In metal fabrication operational technology means efficient core machinery. Albeit expensive this is a long term value addition for a winning strategy.     

Oil Uptick The Ripple Strikes Back

The merciful slow down in oil was a big relief for Nations highly dependent on energy imports. The fossil fuel responsible for global warming is here to stay. No matter what progress is being made in alternative fuels oil remains the major source.    

Well it is a simple global demand and supply game as the Oil Market Report portrays.  The increase in production some time back was due to fracking boom in USA, Iraq recovery and production splurge by KSA. Weak economies dithered the upward rise as consumption receded.   

Inspite of Iran sanction being no more and the 700000 mpd addition the upward swing is noticeable. This is due to natural disasters, political uprisings and terrorist sabotage in Nigeria.  The low prices of crude had encouraged usage in many countries as well as by fast developing Nations like India.    

Low prices has also discouraged fracking in the oil fields of Texas in USA. Shale oil production exhibits a catch 22 situation as reduced production in case of low prices would experience an upward swing if prices bounce back sufficiently higher.    

From 33$ to present fifty dollars the crunch is being felt but not so much as it was during high prices over 100$ per barrel.  

Empowering Economy : Green Renewable Energy

Energy has played tremendous role in shaping economies the World over. No wonder so much depends upon the price of crude and extraction of coal. Both are fossil fuels that generate warming with the emission of carbon dioxide.    

To make matters worse elements that control global warming are being decimated massively. All over the World especially in South Americas and some Asian countries the denudation is at its worst. The countries desperate for revenue generation seek short term benefits from fossil fuels, and activities that permanently destroy the best ecosystems in the World.     

The answer lies in harnessing renewable energy that is emission friendly and does not deplete our resources. All said and done many countries across the globe are actively perusing their agenda to win this battle. So far in spite of positive results they are not tangible.  Alternative energy means like the wind mills, solar panels and bio gas have not been implemented on a large scale to counter the usage of fossil fuels. The problem lies in the cost of the infrastructure which is still high in spite of strides made into the technology.    

All three are future energy sources though substantial generation is taking place.  In case of bio gas generation South Korea leads by example. The waste recycling plants using animal excreta has been set up at places using advance technology. India should emulate such positive development taking into consideration the colossal amount bio waste generated from large live stock population all across the country.      

Though economies have benefited by drastic reduction of price or crude the green answer remains elusive. Sound industrial development, construction and daily usage means using energy that is green or recyclable.   

There is no limit to sources that yield  alternative or renewable energy some of other means are ocean energy, hot rock geothermal power, hydroelectricity, solar heating and of course the much maligned nuclear energy. The latter poses safeguard threats and yes as lately mention the fear of theft of fissile material by terrorists.  .  

Out of the Brink - Construction Industry

The decade was abuzz with the slow down in major economies of  Europe and America the leading power house of modern civilizations. From the world of monopoly and dominant economic centers the World has become multi-polar with many centers of economy.     

The paradigm shift has affected many traditional industries especially augured by a devastating slow down. The recent down slide in oil prices has added to the woes. 

The rapidly emerging economies in Asia, East Europe, Middle East and Latin America offers hope to many in the construction industry with constant needs of urbanization.  In USA salvage packages diversified funding and new opportunities spur growth to new heights changing the dismal picture few years ago. However companies better able to adapt to the changing landscape globally will reap major benefits.     

Though work force concerns will remain new technology trends and increase in spending will fuel growth in 2016. Most of the work force that had migrated back to their countries have not returned. Further tech savvy younger generation neglected during the slowdown so no inclination towards joining the sector.  This continuing trend has resulted in curtailing the project handling capacities of many builders in US. .        

Prefab or modular construction has proven to be more cost effective, green with less time consumption. This is attracting companies to move towards this emerging technology.  

But as per prediction single family housing construction will pick up this year to the tune of twenty five percent.But the multifamily sector will remain as the stabilizing factor.   

Construction activities include commercial construction, engineering projects and urban developments. But the housing sector takes the cake hence the focus of this article.  

Another sphere of activity is the house remodeling sector which is an indicator of increase in spending ability. This is often compounded with repair and renovation work which is so much a part of industry. Thus the professional contractors have added work requirements whence spending is good.   

Oil Prices & Global Impact

For some countries the drastic reduction in crude price has a devastating effect. Most of these countries are into production and refining. The reduction in prices has been due to over production and low demand. This status is going to be further fueled by lifting embargo on Iran and its entry into the oil market.        

In spite of global reduction in the prices the cat and mouse game goes on with the recent upsurge.  In US the swing has been highly volatile with as much as eleven percent rise. Will the price stabilize is at best a conjecture albeit production cut is being talked about among the OPEC and other producers.  The recent slump has been the cause of loss for many oil majors like Shell and BP. 

For UK the slump has been good for the economy resulting rise of wages. According to BBC the heaviest losers are:

Russia with over seventy percent of export income arising from energy.
Venezuela is one of the largest exporter of crude and hence has been hot hard by the slump.

Saudi Arabia can bear the slump for a longer time thanks to its fund reserves.       

For more information read: Impact of falling crude

Global Economic Scenario - Banks

US economy leaping far ahead of the World crumbles and many banking institutions pack up overnight. The economists are stunned no one could peep through the curtains of corporate offices. What happened?

Bolstered by a strong economy and upward trends, the banking institutions fed the public on easily available loans under presumption that return is no big issue. It was! The country had begun facing the heat with most of the manufacturing moving to Asia, competition in service sector and competition from rising economy like India and China.   

These factors have severely affected the developed World especially Europe. For the banking sector a new paradigm has to emerge in order to manage cash adequacy and mitigate risk factors. This means more regulatory norms and stringent compliance.

Capital Flow inwards is crucial for smaller banks to retain fund adequacy. Sound financial strategies are the order of the day.  For small sized large amount of capital input is a necessity if they have to grow bigger.