To me it feels like a time of change. The last two years have been pretty awful for everyone in the cement and lime industry. and it's been pretty awful for people involved in the construction industry around the world as well. Every company has had to make changes that they could have avoided if the good times had continued on, but perhaps that is no bad thing. Sometimes in a boom period the efficiences that ought to be made to optimise the bottom line are forgotten about in the rush to riches. In the lean times those efficiences become an absolute priority and the companies that don't make them simply cease to exist.
At the AUCBM conference in Ras Al Khaimah at the start of December 2010 (see page 57), it was interesting to 'take the temperature' of the industry. "How's business" is a traditional greeting in the industry (much the same as "Ahelen wa sehelen" might be used in the Arab world to say 'Hello'), to which the response in RAK was "Could be better." Of course, business people are never going to say "I've just had my best year ever and I'm making higher margins in this sector that ever before," at least not within ear-shot of their competitors. No, 'Could be better' seems to be the common response at the moment. Everyone is operating at (much) less than capacity, whether it is in terms of cement and lime production or in terms of equipment sales or service provision. Everyone has surplus capacity. Perhaps this is one of the reasons why Global Cement Magazine is doing quite well at the moment: companies are having to make extra efforts to generate more business and advertising in the magazine is one good way of doing that.
We are also expecting a busy year in 2011, as both cement and lime producers and equipment producers 'come out of their bunkers' and start to try to generate more activity. Conferences and exhibitions, of course, are excellent venues for making new business contacts and for meeting people face-to-face in a concentrated, cost-efficient way. Why travel around a country for two weeks trying to meet contacts when you can meet them all in two days in one place?
However, as I mentioned, I feel that this is a time of change. Mr Obama has managed to get his START nuclear weapons reduction treaty passed (with the help of his Republican opposition), despite being pummelled in the polls in November. Now Russia and the USA will only have 1500 nuclear warheads pointed at each other, enough to totally destroy the world only two or three times over, instead of four or more times over. Europe's economies are taking the hard decisions that will eventually allow them to recover (I think that it will be another three years or more before demand in Europe climbs back to where it was in 2007 - (ie: 2014 or later) meaning that our current 'Great Recession' will be of the same magnitude, if not quite as bad, as the Great Depression).
All the companies that cut their workforce by 20, 30, 40 or 50% in 2008-2010 and who have made every possible efficiency gain that they thought possible, will by now be thinking, "Well, what do we do next?" There are two possible options: sit on your hands and wait for something to turn up, or to go out there and grab it. (I was amused to observe that some exhibitors at the AUCBM spent their time texting, watching DVDs, surfing the internet or drinking coffee (and sometimes all at the same time) and in consequence did not make many contacts. In contrast, the exhibitors that were proactive about making contacts had a good show).
Sitting on your hands might be a cosy or comfortable existence ('The easier, the better' being the personal motto of one of the speakers at the AUCBM - see page 59), but it will not put food on the table when your competitors are doing everything they can to grab not only their own share of the market but yours as well. Pro-activity then is really the only game in town for the next few years. And how do you make that change? Here are a few ideas:
- Give your customers what they want (if they want six truck-loads of pink cement delivered at 4am, or a gloppity-gloppity machine and a purple gronk, ask them if they want it to smell of lavender or of rose);
- Get closer to your customers (see also page 62): Clasp them to your metaphorical bosom by setting up a customer-relationship database (and allowing them access to it);
- Use your closer relationship to find out what your customers want (apart from cheaper prices - we know that already);
- Look again at your marketing efforts (preferably with an independent eye) and beef them up (or start again from scratch if you need to);
- Advertise, exhibit, send press releases, create seminars, boost the amount of content on your web site, start a newsletter: do anything to get your message out to your customers and potential customers. In this, we can help.
With all this change, we wish you luck in 2011!