The steel and metals production industry is undergoing a profound change. Demand fell in 2020, while China is ramping up its output, with a market share that is fast approaching 57%. Analysts are confident that current epidemiological trends will keep the industry afloat. For an industry that uses raw metals to fabricate structures, machines, tools, and parts, your business is part of the pillar that holds the entire manufacturing industry up.
But even with value-added processes that include welding, cutting, forming, metal stamping, forging, casting, and machining, the volatile raw material prices and a general slowdown in demand can take a toll on your business. As a result, steel and metal manufacturers like your business are taking extra care in aligning supply and demand while keeping track of highly diverse customer requirements.
The complexity your business faces is piling up. Managing it can be increasingly difficult without transforming how your business sells. But to transform your convoluted sales process, you would first need to understand why it's complex before you can take it to the next level with digital sales solutions.
Manufacturers in this sector employ sales strategies that help them navigate market conditions. However, their strategies can also be influenced by their business model. Here is a brief description of the various business models they use to meet market demand.
Steel and metal manufacturers often use the MTO and MTS business models. However, some manufacturers may choose to go higher up the value chain and perform functions that require more complex engineering. Regardless of the model they choose, incumbents in this industry need to pay close attention to material prices, as slight movements can have a significant impact on their bottom line.
The success of the business would require sales strategies that consider functions like supply chain, stock management, production, design, engineering costs, and quality control.
For example, iron and steel manufacturers’ that deal with ores as opposed to scrap metal are primarily concerned about material prices. But at the same time, they would also require precise demand forecasting. If they have an excess in materials, they would have to spend more on storage, and dips in material prices can affect margins.
The business can be straightforward, but the wide variety of factors that can affect the business comprises most of the industry’s complexity. The data needed to fully manage the business can exceed what legacy systems are equipped to manage. Forward-thinking steel and metal manufacturers are now turning to Industry 4.0 era systems to help manage their sales data and the complexity that comes with the rising number of business functions and sales strategies.
These are challenges that a powerful digital sales platform can overcome through seamless integration with a manufacturer’s ERP, and existing IT systems sales depend on (e.g. Salesforce CRM). Ultimately, it is a strategic choice that leading manufacturers make to meet the demands of the market today, and take advantage of the opportunities that come in the future.
Valuable sales data steel and metal manufacturers need to extract from their ERP
That’s because a leading digital sales platform built for manufacturing is built to support all variables that affect sales in the steel and metal industry. Its seamless integration with your ERP allows it to extract sales-relevant data like costs, prices, and product information, while its manufacturing-focused features use this data to cover the full spectrum of your sales needs like:
With a powerful digital sales solution like the In Mind Cloud Digital Sales Platform, your steel and metal manufacturing business can perform better. Your goal can be to reduce costs, increase revenue, improve efficiency or simply to prepare your business with a competitive advantage--and our Digital Sales Platform is built to get you there.
To find out more about the role digital plays in modern manufacturing sales, download our Manufacturing Sales Handbook here.
Part of this blog post appeared in an article that was first published on the G2 blog