While nearly half (49%) of U.S. manufacturers expect a recession to hit in 2025, most are overlooking straight-forward opportunities to lower their costs and drive profitability ahead of a down market, according to new research conducted and released by CADDi. The proprietary research, which is based on a survey of more than 330 U.S. manufacturing professionals, reveals that manufacturers are making financial decisions based off incomplete information.
60% of procurement professionals have sourced a part at a higher cost than what they knew was possible because they didn’t have access to sufficient supplier data to negotiate effectively. The same percentage of respondents said they’ve missed an opportunity to consolidate suppliers and/or negotiate a volume discount because they didn’t have access to historical cost data associated with similar parts. Additionally, 71% of sales professionals have quoted or sold an unprofitable deal for their company because they didn’t have access to the historical engineering and procurement data they needed.
“American manufacturers are feeling pressure from every angle – the economy, talent shortage, rising competition from China and Mexico, and more. Our research indicates that data and collaboration issues are exacerbating the pressure. Internal teams can’t access the information they need to do their jobs and make smart and profitable decisions fast enough, which increases the stakes for manufacturers that don’t take steps to address the inefficiencies,” says Yushiro Kato, CEO of CADDi.
Key Takeaways:
- Talent challenges remain top pressure drivers, including a lack of access to skilled labor (56%) and equipping current employees to step into strategic roles (50%).
- Speed to market – which 23% of manufacturers say is a 2025 priority - is at risk. Seventy-seven percent of procurement professionals say that every few projects they need to find a new part, product or supplier because the one they found didn’t meet engineering’s specifications.
- A “Great Experience Exit” is on the Horizon. Nearly three-quarters of senior executives expect to retire within the next decade. Sixty-eight percent believe at least half of their institutional knowledge will be lost forever when they retire.
- Manufacturers fear they aren’t transforming fast enough to survive (27%). Forty-five percent of senior management leaders cite digitally transforming their operations as a top business pressure.
- Pressure persists to onshore manufacturing. Navigating political demands to bring more production onshore (51%) was cited as a top three pressure point.
