Out-Law News 1 min. read
20 Sep 2011, 5:13 pm
According to this year's Global Manufacturing Outlook (36-page / 2.76MB PDF) survey of 220 senior executives from leading industrial manufacturers, the UK trails only China, the US and India as a country from which manufacturers expect to increase sourcing over the next 12-24 months.
Top-line economic growth is now the priority for manufacturers worldwide, according to the survey, followed by cost savings and product quality.
This is a "clear shift" from business strategies over the previous two years which ranked saving money as just as important as growth, KPMG said.
More than half of global manufacturers surveyed are planning to sell new products in new and existing markets over the next two years, the survey said.
This confidence is reflected by figures from the UK where 30% of manufacturers expect to sell new products – up from 13% last year, according to KPMG.
The report argues that developed markets including the US, UK and Germany will remain popular commodity sources for western companies looking to source from closer to home due to increased commodity and transport costs.
"Ever-increasing natural disasters are also causing companies to think twice about relying so heavily on a single source or single region for key components," the report says.
The survey was carried out by the Economist Intelligence Unit on behalf of KPMG. Respondents worked for companies with more than $1bn in annual revenue.
Jeff Dobbs of KPMG noted that manufacturers were realigning their business models to promote top-line growth despite "an increasing set of cost challenges".
"Recent economic events in Europe and the UK may have likely clouded manufacturers' optimism somewhat. However the lessons learned from the economic uncertainty, political instability and historic natural disasters of the past few years have taught companies they can survive these challenges with lean agile operating structures, enhanced risk management practices and a focus on innovation," he said.
