Washington state has long been home to iconic manufacturers. Whether they’re dealing in aerospace, wood products, medical devices or electronic gadgets, manufacturers contribute significantly to our state’s economy today.
As part of our initiative to be a valued business partner to manufacturers, we have joined with our global alliance partners to gather valuable manufacturing benchmarking data, which will be useful as part of a company’s strategic planning process.
Clark Nuber PS and The Leading Edge Global Alliance1 (LEA) recently released the annual National Manufacturing Outlook and Insights Survey for 2018. More than 450 manufacturing executives participated in the survey, representing a wide range of industry segments: industrial/machining, transportation/automotive, building materials, food and beverage, aerospace and other products.
Overall, manufacturers’ responses indicate a more positive outlook about the economy for 2018 than in 2017. Reasons for this optimism include:
- The growth of U.S. and global economies
- Rising energy and commodity prices
- Improved business and consumer confidence
For news closer to home, the survey found that manufacturers in the western U.S. are most optimistic about their regional economy.
According to the survey, manufacturers’ top priorities for 2018 are:
- Growing sales
- Cutting costs
- Addressing the talent gap
Other high-level highlights from the survey include:
- 81% of manufacturers believe their revenue will increase in 2018, with 72% eyeing organic growth in the U.S. as their primary opportunity to increase sales.
- 62% of manufacturers expect their sectors to grow, more than doubling the 2017 outlook; food and beverage and building materials cite the highest optimism for sector growth.
- Manufacturers that invest more in R&D expect significantly greater revenue growth in 2018
Challenges and Opportunities
- Labor remains a significant challenge. More than half of survey participants see the labor shortage as the greatest risk or barrier to growth; more than half of manufacturers expect to increase hiring.
- Growing sales while cutting costs may also present a challenge. Only 2%-3% expect costs of raw materials, technology, and labor to decrease.
- Using technology to reduce risks and build a competitive advantage is an opportunity; 75% of respondents plan to investigate/prioritize cybersecurity in 2018, and 50% will investigate/prioritize Big Data/ERP/IoT.
The 22-page survey dives into deeper detail on these and many other topics. If you would like a copy of the survey with the full findings, please contact Hillary Parker.
1LEA, of which Clark Nuber is a founding member, is the second largest international association of CPA Firms in the world, creating a high-quality alliance of 220 firms focused on accounting, financial and business advisory services.
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