Here are the top trends in the industry, which you can read in just 5 minutes. Enjoy!
1. Growth Exceeded Expectations
Growth was higher than expected. Currently, orders do not pose a problem; rather, supply-chain management and availability do.
Analysis: Management focus on finding a plan B for suppliers is time well spent.
2. US Manufacturing Sector Is Growing
In the US, the Manufacturing (NAICS 31-33) sector is expected to grow by an annualized 0.8% to $6.2 trillion by 2026. The US economy is forecast to recover, creating a strong baseline for manufacturing demand. However, oil prices and steel prices are anticipated to marginally decline, limiting selling prices for manufacturers and decelerating revenue growth. The potential resolution of trade issues with China could bode well for export revenue as well, as China was the sector's third-largest market for exports in 2021. Industry revenue over the next five years may also be affected by variants of the Coronavirus and inflation.
Analysis: The industry will benefit from the long-term growth in manufacturing.
3. Prices Trailing Demand
Revenue is growing at a high rate, though prices and prices are beginning to catch up. Expect prices to continue to build.
Source: General Industrial Revenue: MDM Baird
Analysis: Competition is less about price, and more about availability and speed. This gives an opportunity to increase prices for certain products. Prices from suppliers are also going up.
4.Growth Benchmarks Hit Double-Digits
Analysis: Double-digit growth occurred in Q4 for several categories. Check to see if your growth is matching the industry, and ask “why” or “why not”?
5. Technology Continues to Advance
Technological advances in both manufactured products and manufacturing processes are expected to drive changes in the structure of the sector. Manufacturing processes will probably adapt as products become more connected and software-enabled. It is likely that operators will continue to adapt processes in order to match the software publishing industry.
Analysis: Not investing in technology at this point poses a threat to an industrial supply business.
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