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Survey: Small and Midsized Manufacturers Plan for Continued Growth

April 20, 2012, 07:30 AM
Filed Under: Economy

Prime Advantage, the leading buying consortium for midsized manufacturers, announced the findings of its ninth semi-annual Group Outlook Survey, revealing financial projections and top concerns of its Member companies for 2012. The findings show the majority of its Members are forecasting revenue increases and plan to hire more employees.

Summary of Findings

  • Seventy-two percent of respondents expect to see their revenues increase in 2012 (compared to 73% in 2011).
  • Eighty-eight percent of companies expect to make the same level or higher capital expenditures in 2012, with 41% planning to increase capital expenditures from 2011 levels (this percentage is on par with 2011). Similar results were published by the ISM, with 42% of companies predicting an increase in capital expenditures for 2012.
  • The positive hiring trend continues into 2012, with 56% of companies planning to add employees in 2012 (up from 48% measured in February 2011).
  • The cost of raw materials remains the top cost pressure concern for purchasing professionals, followed by the cost of base materials and healthcare costs.

Most procurement professionals expect growth in 2012, with 72% of respondents expecting revenues to increase over last year. These findings are similar to the ISM Semiannual Economic Outlook, where 69% of respondents expected revenue increases for 2012. The main reasons cited for expecting higher revenues are an increase in overall customer demand (63%) and the introduction of new product lines (46%). These results show that the U.S. manufacturing economy continues to gain strength, as only 56% of respondents cited an increase in overall customer demand in 2011.

"We are seeing a strong growth trend from our Members in revenue, capital expenditures and hiring, which are all healthy signs for our Membership and manufacturing as a whole,” said Louise O'Sullivan, founder, president and CEO of Prime Advantage. “As the economy continues to pick up steam, our Members know they have access to stable supply partners within our group with savings programs in place to make them more competitive. We're fortunate to have industry leaders in our group, both on the Member and Supplier sides of our business, and we'll continue to deliver savings as they grow their businesses.”

To read the full Prime Advantage press release, click here.

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