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Half of U.S. manufacturers looking to source domestically, says survey
- March 24, 2020
- News Release
- Shop Management
This month’s Thomas Industrial Survey of 1,400 manufacturers revealed a sharp rise in manufacturing companies predicting a decline in revenue for 2020. In March 55% of manufacturers indicated they anticipated a reduction in revenue compared to only 34% in February's survey results.
About half of North American manufacturers (47%) are now looking to source domestically because of the disruptions caused by the coronavirus outbreak. The ancillary oil price plunge led 53% to expect an impact on their business; some are optimistic, but most are concerned.
Only 45% of companies report that they are impacted by the outbreak, compared to 60% in February. Although fewer companies report that their businesses are impacted this month compared to last, this can be attributed to China resuming some of its production and shipping capabilities. Data collected in April will be much more telling in terms of this outbreak’s economic impacts on the manufacturing sector.
To help manufacturers navigate these challenging times, Thomas also has launched the Thomas Coronavirus Resource Hub, where manufacturers and industry professionals can unite and distribute resources.
Concerns for disrupted shipping and logistics dropped significantly, from 71% in February to 42% in March. Concerns regarding offshore factory suspension and production restrictions also are easing, down from 55% to 36%, respectively. However, there is a significant rise in concern, from 12% up to 22%, regarding price surges for cost of goods.
Survey responses are reflecting U.S. manufacturers’ ingenuity during this crisis. Some of the main coping tactics are:
- Increasing production, building plants, and adding processing facilities in North America.
- Taking on more work to support customers impacted by degraded supply chains.
- Introducing alternative shipping methods, working with factory representatives to prioritize work, and negotiating shipping terms for late shipments when necessary.
- Shipping ahead of schedule to meet the actual requested delivery date.
- Seeking new customers and cold calling to gain new business and attempt aggressive sales tactics by utilizing significantly reduced pricing to stabilize their revenue pipeline.
- Introducing new technologies, e.g. machinery acceptance tests being done by live feed camera.
- Increasing sanitation/preventive measures.
When asked what materials were needed to stabilize supply and keep production on schedule, manufacturers reported:
- Fabricated materials (machined, stamped, extruded, or molded material) at 41%
- Metals (steel, aluminum) at 30%
- Electrical or electronic components at 30%
- Raw materials (paper, wood, textiles) at 26%
- Machining tools and parts (fasteners, bearings, cutting bits, abrasives) at 21%
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- Podcasting
- Podcast:
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- Published:
- 04/16/2024
- Running Time:
- 63:29
In this episode of The Fabricator Podcast, Caleb Chamberlain, co-founder and CEO of OSH Cut, discusses his company’s...
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