Due to a variety of factors, the potential application range of traditional mechanical flow meters is limited. In contrast, electronic, non-contact flow measurement systems offer several functional advantages with demand for these flow meters set to spur growth in the European flow sensors and transmitters markets.
Frost & Sullivan finds that the European flow sensors and transmitters markets earned revenues of US$1.335 billion in 2005 and estimates this to reach US$2.114 billion in 2012.
"The European flow sensors and transmitters market will be primarily driven by the migration of end-users toward electronic, non-contact flow measurement systems," said Frost & Sullivan research analyst S. Gomathinayagam. "These flow meters offer advantages over mechanical flow meters in terms of higher accuracy and reliability and also do not obstruct the flow in pipelines."
As a result, electronic, non-contacting flow meters are increasingly being preferred over mechanical flow sensors. Even as demand for electronic flow sensors and transmitters is set to rise steadily over the long term, they will increasingly replace existing mechanical systems in many instances.
Despite overall market expansion, however, intense competition among market participants will lead to lower profitability, with companies adopting a low-price strategy in order to boost volume sales. This strategy will adversely affect the profitability of many smaller companies and may even threaten their existence.
At present, more than 100 competitors offer relatively similar products at similar price and performance points. This makes the European flow sensors and transmitters markets highly competitive. To increase sales volumes, these market participants often resort to undercutting unit price.
However, this strategy may adversely affect their bottom line. Companies might be unable to realize economies of scale since market demand is not expected to grow at a similar rate. As such, it will be difficult for them to remain competitive and profitable.
"Market participants should focus on developing truly innovative, customized products and solutions that offer better value to customers," said Gomathinayagam. "New product development programs should be designed around feedback from customers and should be market-driven."
Companies should understand their target end-user markets and their requirements. Monitoring customer feedback, understanding the unique requirements for target end-user markets and developing suitable solutions are some of the best practices that market participants will need to follow to establish a lasting relationship with customers and consolidate their position in the market.
If you are interested in a virtual brochure, which provides manufacturers, end-users, and other industry participants with an overview of the latest analysis of the European flow sensors and transmitters markets, e-mail chiara.carella@frost.com.
