During my internship at Godrej & Boyce I ran a market study on entering new countries with process equipment — the large fabricated vessels and columns that sit inside refineries, power plants and, increasingly, hydrogen facilities.
The brief sounded like a demand question: where is there appetite for this equipment? The useful answer turned out to be a business-model question instead.
Demand is the easy half
You can size demand for industrial equipment reasonably well from public information: announced capital projects, refinery expansions, energy transition commitments, hydrogen roadmaps. Across oil & gas, power, energy and hydrogen there was no shortage of demand anywhere.
Which makes demand almost useless as a selection criterion. If every target market wants the product, demand doesn't rank them.
What actually ranks a market
Three things, none of which are about the customer wanting the thing:
1. Where the cost base lands. Process equipment is heavy. Fabricated steel does not travel cheaply, and freight is a real fraction of the delivered price. A market that looks attractive on demand can be structurally unwinnable because a regional fabricator will always land the same vessel cheaper. The model only works where your engineering capability is worth more than their freight advantage.
2. Who qualifies you. Industrial buyers don't buy on a quote. They buy from an approved vendor list, and getting onto one takes audits, certifications and reference installations — often years. That's a fixed entry cost per market, paid before the first rupee of revenue. It means market entry behaves like a capital investment with a long payback, not a sales push.
3. How specialised the requirement is. The more specialised the internals, the less the freight disadvantage matters and the fewer competitors clear the technical bar. Commodity vessels are a race to the bottom; complex ones are a different business with a different margin.
The reframe
Put those together and the question stops being "where is the demand?" and becomes:
> Where is our engineering capability differentiated enough to outweigh the > freight penalty, and is the qualification cost worth the size of the prize?
That's a business-model question. It's answerable, it ranks the candidates properly, and it produces a recommendation a commercial team can act on rather than a slide deck of market sizes.
The lesson that generalised
I've found this transfers well beyond industrial equipment. When every option looks attractive on the obvious metric, the obvious metric isn't the constraint — and the constraint is almost always structural: cost that doesn't scale, a gate you have to pay to pass, or a differentiator that only pays off in some segments.
Find the constraint, and the ranking falls out of it.
I write about business models, process, and endurance sport.