The steel sector is the “key” of the fundamental sector of India. The quick industrialization of the nation demands the rapid evolution of steel industries. The evolution of agriculture, consumer goods industry, transportation and communication centers, tools and machine-making industry, electric machinery manufacturing industry, etc. are all to depend on the development and expansion of steel industries of the country and the steel prices in India.
The steel business is providing direct employment to about 2.5 lakh workers. The seventh plan fixed the goal to increase the production capacity in saleable steel to 15 MT and to raise the volume of total production to 13 million tonnes. At the end of the program, the target was fulfilled.
Problems Faced By The Steel Manufacturers & Exporters
Steel businesses are facing constant pressure to stay competitive within a low-growth small business atmosphere. This is the end result of continuing volatility and dynamics from the world markets, driven in part at the conclusion of China’s rapid financial growth cycle in addition to fluctuations in commodity costs and increasing regulations.
In today’s increasingly competitive markets–both export and domestic –it is also crucial that metal companies have a firm grasp in their real steel prices in India to serve customers. This implies not only after delivering the order (“real costs”) but also prior to and while accepting the order (“planned prices”). In addition, this implies not just one time per month, but also in real-time.
Often businesses lack a systematic management process around their yearly calculation of production costs; as a result, the insights obtained from variance investigations using standard costs aren’t consistent across business units and just allow restricted insights into previous business performance. Additionally, inconsistently set benchmark costs could possibly distort merchandise pricing and consequently directly affect reduction and profit (P&L).
This all leads to business requirements in several areas, examples of which include:
- Profitability investigation. Recognizing the expected profitability at the time of sales, order entry and real purchase profitability after delivery and invoice.
- Performance of all production-related pursuits. Performance goals and their dimension for production activities (indirect and direct) in each step of production.
- Inventory valuation. Correctly valuing stock with the objective of having a meaningful number that provides the company with a precise appraisal at any given moment in time
These days, many steel businesses find it hard to get the above-mentioned objectives without manual effort, and they’re also not capable to achieve this in real-time.
A structured approach to product costing will help steel companies better navigate the challenges confronting them in highly competitive markets. It is going to also work as a foundation for creating the digitally-enabled capabilities required to turn into a top rate venture.
Management Of Steel Prices In India
The continuous hike in steel prices in India in the previous times is giving sleepless nights to steel products manufacturers and exporters. The industry fears the 30-35% rise in steel prices in India throughout the period will cause them to non-competitive from the global marketplace and it would be hard for them to fulfill export duties.
CostMasters Consulting Services operates as a study, outsourcing and consulting service provider in India. They have a domain experience in Product Cost Management software solutions such as raw material Price tracking, Spend Analysis, Sourcing Services and designing best-in-class Procurement procedures that revolve around profitability for you. They cater to the automotive, auto ancillary and other engineering goods businesses.
They’re a group of highly committed, experienced & qualified professionals of various domain areas to serve you in managing steel prices in India. In CostMasters, they are 100% dedicated to positioning procurement at the core of business performance. Whatever they do, they put empathy for your enterprise, reality-based strategy, and data-based analysis & quantifiable outcomes.
Target Cost Management Software, a division of CostMasters, supplies cost engineering services for mid-to-large sized manufacturing companies worldwide. The agency is a perfect solution for companies that do not have either the time or resources to perform detailed product price evaluation in-house.