Survey: Some Manufacturers Remain Upbeat, Despite Economy

Industry Week reports that a recent survey by Prime Advantage, a buying consortium for industrial manufacturers, shows that 87% of the industrial manufacturer respondents will be introducing new products this year, and 70% plan to introduce new products in 2010.

Nearly two-thirds of the surveyed companies expect their revenue to decline in 2009, with 37% of this group expecting revenues to decrease up to 10% and another 25% expecting a revenue decline exceeding 10%. Manufacturers said raw material costs, such as metals and plastics, were the top cost pressure they faced. Other costs cited were overhead costs (50%) and logistics/supply chain costs (49%), followed by health care (43%), energy (27%), foreign competition (27%), inflation (25%) and labor (23%).

The top external concern cited by respondents was customer demand (83%). Credit markets and interest rates was cited by 44% of manufacturers, while 37% expressed concern about the volatility of the dollar.

Sixty-six percent of manufacturers said capital spending for U.S. locations, including significant capital improvements or new purchases of property or equipment, would decrease from 2008 levels. Some 34% expect capital spending to be equal to, or more than, last year’s spending.