According to a recent blog post by our partner, Infor, manufacturers are expressing optimism for growth in 2018.
A report published by the Leading Edge Alliance paints a rosy picture of the global outlook for manufacturing. Manufacturers’ optimism for the world economy in 2018 is now 59.4% — almost a 15-point increase over the 2017 outlook. Manufacturers are also optimistic about their national economies (69.3%) and their regional economies (69.3%)
Just how bright is this rosy portrait?
In the previous year, only 30% of manufacturers expected their sectors to grow. For for 2018, however, that percent has more than doubled to 63%. In addition, the percent expecting it to contract dropped from 10% for 2017 to 4% for 2018.
Compared to the flat, sluggish recovery figures that have plagued manufacturing for the past decade, this new optimism seems absolutely glowing. Survey findings show that 81% expect increases in revenue and 72% expect organic growth. It’s important to note that the survey was conducted in October 2017, before the tax reform legislation was passed in the US. The tax reform largely has been perceived by the manufacturing industry as a positive measure, and would possibly boost optimism yet further.
How do manufacturers plan to achieve growth? Almost three-fourths of manufacturers see organic growth within the U.S. as their primary opportunity to grow sales. This was followed by 44% of manufacturers expecting new product or service development. This aligns with digitalization trends which indicate that manufacturers are launching more products which are highly customized or configured. New service-related offerings are also gaining attention, as are offerings which are largely data-driven, such as sharing with customer performance data.
The survey also shows that about 20% expect growth to come from joint ventures/strategic partnerships or organic growth in markets outside the U.S. This makes sense as manufacturers are relying on partnerships to produce components and specialized elements. Another important point is that 47% of manufacturers with international sales expect to see growth in that segments as well.