Industrial Mineral Transportation and Marketing Part 2

1
Industrial Mineral Transportation and Marketing
(Part 2)

• James M. Barker
• Bureau of Geology and Mineral Resources
• A Division of New Mexico Tech
• 801 Leroy Place
• Socorro, NM 87801 USA

2
Key Concepts

• The Marketing Concept
• Just-in time Delivery
• Quality Retention
• Proactivity
• Expertise at all levels
• Global Customer Service

3
Industrial Mineral Export Competition

• Competitors near your distant market
• Pricing pressure
• Substitutes
• Political and cultural differences
• Communication problems
• Currency fluctuations
• Trade finance restrictions
• Transport imbalances

4
The Marketing Concept

• Used by some at least since the 1950s
• Opposite of the technical approach
• Engineers develop product
• Sales force then convinces customers to buy
• Uses the people-oriented approach
• Sales force determines customer needs
• Engineers design product (with enhancements)
• Know customers, customers customers, and
  competition, plus all market factors

5
Transportation and The Marketing Concept

• Transport dominates IM delivered cost
• Customers respond to lowered cost
• Large transport costs often easier to lower
• Market location
• Transport mode or intermodal
• Contract type and negotiator
• Quality of service companies used
• Customer Service
• Quality retention
• Just-in-time delivery
• Proactivity

6
Transport modes

• Modes TruckltRailltBargeltShip
• Containers Intermodal
• Stay on top of the transport market
• Transport market changes daily
• Operates 24/7
• Think outside the box
• Hire a transport manager
• Periodic reevaluation of delivery chain
• Tie customer service closely to transport process

7
Transport Contracts

• Very complex area
• Risk is involved
• Rail, barge and ship contracts are tricky
• Use expert contract negotiators brokers
• Understanding contract terminology can be crucial
  to success or failure
• Remember to focus transport contracts on customer
  needs as much as possible

8
Quality of Transport Service Companies

• Product handled many times during transport
• Long distance transport rarely all in-house
• Thus need brokers, traders, stevedores, service
  companies, etc.
• Value added, integrated, quality conscious
• Use highest quality/expertise at all stages
• Ensure greatest possible edge over better placed
  competitors

9
Transport Delivery Location

• For global market, transport can be very far
• Long distances greater potential problems
• Intermodal
• Multiple handling
• Delays of various kinds
• Communication problems
• Some locales easier to serve than others
• Extra effort in difficult area can yield
  spectacular success to service-starved customers

10
Global Customer Service

• Global Customer Service is large undertaking
• Tracking all aspects at a distance is tough
• Need real-time data to rectify problems early
• Better that you solve a problem than have
• the customer ask what happened and you
• must ask the same question
• Be proactive, not reactive, at all stages of
  industrial mineral delivery chain

11
GCS continued

• Global trade is based on relationships, and is
  not entirely price driven
• Use local experts to limit cultural gaffes
• Typical problems
• Wrong product
• Transport delays and demurrage
• Government export-import interactions
• Quality damage
• Be there when the customer needs you

12
Summary

• Determine customer needs
• Meet these needs with a concerted and ongoing
  company-wide commitment
• Maintain quality and control at every stage of
  industrial mineral delivery chain
• Win customers around the globe through superior,
  proactive service at a distance