More Hiring and Online Buying in 2015

Reports point to an expected increase in hiring among midsize manufacturers and more growth in B2B e-commerce.

MANUFACTURING PROFESSIONALS EXPECT THEIR companies' revenues to keep rising through the remainder of the year, and half expect to increase hiring in the year ahead according to the most recent annual Purchasing and Manufacturing Survey from Chicago-based Prime Advantage Inc., a buying consortium of midsize manufacturing firms.
Prime Advantage surveyed more than 700 U.S- industrial manufacturing companies, revealing continued optimism about revenues and employment, despite concerns about rising costs and a lack of qualified workers. Some key findings of the report include:

  • 49% of respondents said they expect revenues to increase in the second half of 2014 compared to the first half.
  • Capital expenditures are expected to increase in the second half of 2014 for 42% of the midsize manufacturing companies in the group, an increase of 12% from 2013's survey projections, the firm said.
  • The cost of raw materials continues to be the main purchasing concern for members; the survey indicates an increased focus on process cost sayings and efficiency.
  • The top prediction for. potential barriers to continued business growth is a lack of qualified workers, 53%.
"Our members are making some of the highest projections for the next six months that we're ever seen,"  said Louise O'Sullivan, founder, president, and CEO of Prime Advantage. "Revenue forecasts, capital expenditure plans, and labor force expectations are all at record levels."

The report is in line with other positive industry outlooks. Global Purchasing Index, for instance, has remained above the I00-point mark indicating economic optimism among electronic component buyers since its launch in January of this year. The index has been on the upswing since July, when growth  slowed and hit its highest level since January in October, at a reading of 123.

ONLINE PURCHASING ON THE RISE

In a separate study, manufacturing professionals were among those reporting a shift in buying behavior toward online purchasing recently- even when making big ticket purchases, according to a late 2014 B2B purchasing study from Acuity Group.

The study reveals a steadily growing interest among procurement officers to purchase company supplies online -  from manufacturers, their distributors, and from third parties such as Amazon Supply.

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''Busjness-to-business commerce increasingly resembles the consumer e-commerce space, with users across industries now expecting similar ease-of-use in the online B2B shopping experience," according to the State of B2B Procurement Study released by Acuity this fall. "Now, it's up to suppliers and  distributors to help shift the procurement landscape to meet expectations."

The study found that 41% of B2B buyers - including those in manufacturing, retail, health care, and pharmaceutical industries - are willing to purchase any type of business product online. What's more, 68% report participating in some form of electronic purchasing in 2014, up from 57% last year. The behavior extends to major purchases, as 66% say they are comfortable making a purchase of $5,000 or more online, up from 40% in 2013.

"This demonstrates room for continued growth, as nearly 14 percent report making those large  purchases at least once per month," the study suggests.

Acuity Group's State of B2B Procurement Study surveyed 500 buyers with annual purchasing budgets of $100,000 or more about online purchasing habits and preferences.

Posted from: Electronic Design Magazine, December 2014 edition

Author: Victoria Fraza Kickham

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