by Pumps & Systems staff
December 28, 2016

Pumps & Systems staff spoke with Flowrox Inc. President Todd Loudin about the major trends to anticipate in 2017 and how the landscape of the pump industry will change.

How is departure of longtime, knowledgeable employees due to retirement, etc., affecting your company, and what steps are you taking to fill the resulting employee skills gap?

Flowrox is not currently being affected by retirement of longtime, knowledgeable employees. That trend at Flowrox will likely happen within the next 10 years.

However, we are seeing that some of our customers are facing this issue. For this reason, Flowrox has launched its Malibu 3D Smartware that will put useful information into the hands millennials operating plants on the asset level. The system is point and click to drill down through the layers of a plant.

How do you see governmental regulations impacting the market in the coming year?

With the election of a Trump White House, there will likely be relaxation of EPA standards positively impacting coal and coal-fired power plants, for instance. Also, there may be major pipeline projects that have been stalled for years that will likely achieve the go-ahead to proceed.

If Trump’s plan for a corporate tax rate reduced to a flat 15 percent, then the result will positive for all kinds of industry to relocate back to the U.S. There will be companies that have moved to low-cost countries that wish to take advantage of the low tax rate and skilled workforce that is not as readily available in LCCs.

What are your predictions for the oil and gas market in 2017?

Target price of Brent crude between $60-$70 by the end of 2017. Petrochemical production investment will increase by about 5 percent in 2017.

What trends/activity are you seeing in mining, desalination, chemical processing, pulp & paper, etc.?

Mining as well as pulp and paper remain relatively flat in the first half of 2017. The second half may see modest increases of projects but the overall growth of projects compared to 2016 will only be a 1 percent increase. Chemical processing has been more vibrant in 2016 than mining and pulp and paper. Chemical processing will see growth of about 2 to 3 percent in 2017.

What kind of year will this be for water/wastewater?

Water/wastewater has been active in 2016 and will remain so in 2017. There will likely be an increase of spending of 5 percent in this sector in 2017. This trend will continue through 2020.

What general business trends/challenges do you foresee for the future?

2017 will not be ripe with an abundance of expansion or greenfield plants in 2017. Generally, the first half of 2017 will be very similar to the first half of 2016. The second half of 2017 will experience increased project activity.

What can end users expect to see in 2017, and what should they do to prepare?

Expect a mirror result of 2016 unless you make moves to improve your market position. Focus on reducing COGS to improve margins, advertise the same amount or more in 2017 to improve your market share compared to competitors, and carefully guard the addition of new employees and operating costs to ensure positive profitability. Motivate your sales staff to be active and focused on target customers.

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