Industrial Companies are Spending More, Exceeding Revenue Goals in 2007

Growth in new markets, product lines.

Some 69% of U.S. industrial companies reported that their revenue would be higher in 2007 than 2006, according to the sixth annual Industrial Indicator Survey conducted by GlobalSpec. Additionally, 79% reported that 2007 revenue is on or ahead of target, while 82% of respondents reported that spending in the second half of 2007 will be ahead of or equal to spending in the first half of the year.

Companies are indeed expanding their footprint as 40% entered new markets in 2006 as compared to 35% in 2005. And 37% are increasing product lines, up from 31% in 2006.

Sales and marketing saw increases as well -- with 28% increasing expenditures in these areas, while 28% are adding employees and 26% are increasing capital expenditures.

Costs are sill a concern, especially raw materials with 54% citing this as an area to be watched compared to 46% last year. Rising energy costs are keeping executives awake at night with 45% rating it as a top concern this year compared to 40% last year.

Additional findings include:

  • 33% of respondents reported working more hours than last year, and 53% are working on more projects
  • 68% of companies outsource at least some engineering work, a slight increase over last year
  • The most common areas for company reductions include spending, outsourcing manufacturing, consolidating vendors, and travel.

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