The Industrial Instrumentation Group (IIG) has granted SA Instrumentation & Control exclusive rights to publish sections of the results of the survey of the South African instrumentation and automation industry the IIG conducted in early 2004.
Different sections of the results will be covered in future issues of this magazine. This month we will be reporting on the company turnover results.
Overview
The survey results should be understood in the context of the companies that participated in the survey. The survey was open to all 'top level' companies that sell control and instrumentation equipment. By 'top level' we mean those companies that manufacture or directly import equipment. Resellers of equipment (ie, companies purchasing equipment from a primary distributor) were not eligible to participate in the survey. End-users and purchasers were also not eligible to participate in the survey.
There was no direct cost to companies participating in the survey. The member companies of the IIG agreed to sponsor/finance all costs associated with the survey.
Question
The first question the participants were asked was, "What is your company's total instrumentation and automation turnover for the calendar year ending December 2003 (Retail value excluding VAT, rounded to the nearest million)?"
Results
The results of the survey were as follows:
115 companies provided their company's turnover. The total value of the respondents' turnover was found to be R2 908 347 097 (R2,9 billion). The distribution of total revenues are shown using the histograms in Figure 1. Note that the figure is a non-linear representation, with the first six columns showing a span of R50 million turnover and the following 5 columns showing a span of R250 million turnover.
It is patently clear from the graph that turnover is not equally spread out across the range of respondents. The vast majority of companies are what could be described as small, or small/medium.
Although the mean (average) total turnover of the respondents is R25 642 149, only 24 of the 115 respondent companies actually achieve more than the average turnover.
The vast skewing of the market turnover is further illustrated by the fact that 28 of the respondents (24%) are responsible for 80% of the turnover. Similarly, 20% of the 115 companies are responsible for 73% of the total market turnover (R2 152 658 380). Thus the 80:20 principle is fairly closely approximated. (The Pareto Principle, also known as the 80-20 Rule, states that a small number of causes (20%) is responsible for a large percentage (80%) of the effect.)
Judging from the list of companies that did respond to the survey, the majority of 'significant players' did take part in the survey. Of the remaining companies that did not participate, it can be estimated that they could be responsible for approximately 20-30% of the market turnover. This would equate to an estimated total market value of approx R3,5 billion.
All results of this survey are copyright protected and may not be reproduced without written permission. The full results of the survey are available to non-participating companies and individuals at a cost of R3000.
For more information about The Industrial Instrumentation Group, visit www.iig.org.za
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