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3 MIN. READ
Are you currently working with the U.S. manufacturing market? If not, why not?
Manufacturing is an often-overlooked sector. That oversight could cost your company significant sales. The nearly 400,000 manufacturing companies in the United States have tremendous buying power.
Passed in early November, 2021, the Infrastructure Investment and Jobs Act will be an important gain to Americans and American manufacturing.
The Act upgrades roads, bridges, railways, ports and airports. These improvements will help ease the current supply chain bottlenecks. The electrical grid also receives a long-overdue makeover.
The Act includes funding for the research and development of electric vehicles. Finally, it has funds for clean drinking water and other infrastructure investments. These items will result in a cleaner environment and improved living conditions for all Americans.
American manufacturing stands to benefit from all of these projects. The Act will rely on American manufacturers and American technology.
Contrary to popular belief, manufacturers buy more than parts to make a final product. They have the same need for products and services as any other industry. They buy stuff, a lot of stuff – and they utilize a lot of services, from staffing to marketing, IT, finance, and more. And best of all, they have more money to spend than most other businesses in this country.
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In the last quarter of 2021, surveyed manufacturers expected their capital investments to grow by 3.6% over the next year. They anticipate a 5.4% growth rate in production. Combined with a projected revenue of $7,958,200 million in 2022, manufacturers have the money they need to upgrade their operations.
These numbers show that manufacturers plan to expand. They plan to streamline and buy new equipment. With the current worker shortage affecting all industries, much of the equipment will include robots and other smart manufacturing choices.
This new technology will need strong data infrastructure and software. Many manufacturers still rely on stand-alone computers. They need to link systems and exchange data between various work areas. This situation provides a great way for technology companies to break into the manufacturing marketplace.
As manufacturers increasingly rely on technology, their risk of a cybersecurity attack increases. Employees bringing a simple cell phone into the office can increase a manufacturer’s risk. Cybersecurity risk mitigation services companies will find a great need for their products.
It’s a good thing that manufacturers have the capital that they need for expansion and streamlining. One of the many side effects of the prolonged pandemic is an increased consumer spending.
Federal stimulus checks provided much-needed financial security. Reduced spending on the cost of commuting to work also increased many bank balances.
As bars and restaurants closed, Americans upgraded their small kitchen appliances to re-create their favorite dishes at home. Furniture manufacturers saw increased sales, as any available space in the house was converted to a home office or a home classroom.
The downside of this increased demand for products is that they became scarce. For some items, manufacturers simply couldn’t keep up with the demand and needed to create new partnerships to increase production. Other products fell victim to the supply chain morass.
U.S. manufacturing ranks first in many global manufacturing sectors. America outranks every other country in the production of chemicals and pharmaceuticals; computer, electronic and optical products; motor vehicles, trailers and semi-trailers; fabricated metal products; coke and refined petroleum products; paper products and printing; and other transportation equipment.
Unfortunately, America ranks third in the production of electrical equipment, well behind top-ranking China. This fact plays a big role in the supply chain issues currently troubling U.S. manufacturers.
China is the world’s top manufacturer of semiconductor chips. Guess what goods require semiconductor chips? Computers, motor vehicles and even printing presses require semiconductors. Without them, American manufacturing stalls.
While the COVID pandemic affected every country, China follows extremely strict protocols. These rules result in the closure of factories and major ports several months when an outbreak is detected. A Chinese manufacturing or shipping stoppage results in no semiconductors for the U.S. and other countries.
Even as production renews, U.S. ports are clogged with ships waiting to be unloaded. A truck driver shortage slows the supply chain after the containers are unloaded. Warehouses experience the same difficulty hiring and retaining a workforce.
For many years, American manufacturers ran on the principle of “just in time” ordering. As long as the global supply chain remained stable, this practice made sense. However, the global supply chain has been anything but stable since the Covid-19 pandemic hit.
Now U.S. manufacturers are turning to local partners or expanding their own operations to shorten supply chains and maintain productivity. And with demand soaring, U.S. manufacturers are on the hunt for more services as well to help them get their products out the door.
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Company profiles also contain the names, titles and email addresses of executive decision makers, simplifying and streamlining your research and contact process. The IndustrySelect data sales team can provide your business with thoughtful strategies for working with any company, in any sector. IndustrySelect has helped nearly 40,000 sales and marketing professionals across diverse industries, from staffing and finance, IT and marketing, generate millions in new business. Try a free demo today!