Posted June 7, 2010
Survey: Larger manufacturers and distributors more optimistic
A new survey reports that larger manufacturers and distributors convey higher optimism than other manufacturers and distributors regarding business conditions.
This is due in part to their ability to strengthen their competitive advantage through global engagement and international trade. However, small and midsized manufacturers and distributors express tempered optimism as they move into the recovery. This stems in part from concern over credit availability, potential raw material and energy cost increases, and cautious investments in inventory.
McGladrey's 2010 Manufacturing and Wholesale Distribution National Survey shows that nearly one-third (32 percent) of responding companies with annual revenue of $500 million or more report their business is "thriving and growing." That percent decreases significantly, however, among companies with less than $25 million in revenue, with only 19 percent indicating their business is "thriving and growing." Ten percent of all companies polled said their business conditions are declining, a 30-percent drop from 2009 and the best result in this category since 2007.
"The improvement in business conditions for larger companies is directly related to increased order activity spurred by growing optimism over the economy," said Tom Murphy, executive vice president of manufacturing and wholesale distribution, RSM McGladrey. "But we're still seeing lower levels of inventory and spot shortages in the supply chain given that small and midsized companies remain so risk-averse following the recession."
Click here to download the full report.
