“Manufacturers Optimistic Despite Challenges –
Companies Expect Revenue Growth in 2019 with a Focus on Improving Profitability and Growing Sales .” – According to Leading Edge Alliance National Manufacturing Outlook Survey
For the third year, YHB and LEA have released the results of the 2019 Leading Edge Alliance (LEA) National Manufacturing Outlook Survey. More than 350 manufacturing executives participated in the survey, which includes respondents who produce industrial/machining; transportation/automotive; construction; food and beverage; and other products.
“Across the board, manufacturers are optimistic about the regional economy, sector growth, and increasing revenue expectations in 2019,” the report states. “Looking ahead, manufacturers expect raw materials, labor costs, lack of available talent and competition to be significant hurdles in 2019. The tariffs implemented by President Trump provide productivity issues; however, an increase in spending on Big Data and business intelligence are delivering innovative technology for minimizing productivity concerns.”
2019 Survey Highlights
- Growth: 81% of manufacturers expect their revenue to increase in 2019, and 61% expect their overall sector to expand in 2019.
- Economy: Optimism for the regional, national and global economies has increased by more than 12 percentage points over the last two years.
- Priorities: Manufacturers’ top three priorities are growing sales, improving profitability and addressing the workforce shortage.
- Challenges: Most manufacturers (52%) cited labor/talent as their greatest barrier to growth, followed by competition (34%) and profitability (25%).
The survey identified three key growth strategies manufacturers will use to keep their companies on a growth track: Technology, mergers and acquisitions, and talent management.
- Technology: Manufacturers plan to leverage technology as key to solving productivity concerns; 76% said that they will investigate/prioritize cybersecurity in 2019, and 43% said they will prioritize Big Data/ERP/IoT.
- M&A: More manufacturers are considering a merger/sale or acquisition in 2019; 21% expect to acquire another business in 2019 and 16% are in the pre-planning stage of a merger or acquisition.
- Talent: Faced with a growing labor shortage, manufacturers have turned to a range of tools to improve hiring and retention with 62% increasing compensation, 39% implementing retention strategies and 35% using internal training programs.
“The challenge of gaining a competitive advantage remains critically important,” the report says. “We believe the resilience and success our manufacturing clients have created for themselves will help alleviate the major concerns for 2019.”
About YHB: Yount, Hyde and Barbour (YHB) is a leading certified public accounting and consulting firm with 6 strategic locations. Established in 1947, YHB offers comprehensive accounting, auditing, tax and risk advisory services to clients. In addition to serving individuals, estates and trusts, the firm has extensive experience in working with both public and private businesses.
About LEA: Founded in 1999, LEA Global/The Leading Edge Alliance is the second largest international association in the world, creating a high-quality alliance of 220 independently owned accounting and consulting firms focused on accounting, financial, and business advisory services. LEA Global firms operate in 110 countries, giving clients of LEA Global firms access to the knowledge, skills, and experience of 2321 partners and 24,000 staff members. LEA Global firms’ combined annual revenue totals more than $3 billion. Members stand out as leaders in their markets with firms ranking in the top tiers throughout all regions of the world. In the U.S., more LEA Global firms are in the top 100 than any other association or network.
Please direct all media inquiries to YHB Marketing Director, Jeremy Shen at 540.662.3417 or Jeremy.Shen@yhbcpa.com