Manufacturing Predictions for 2011 - Remke Blog

Popping the cork from champagne may not be what most manufacturers will do at the end of 2011.  But they might just open a couple of nice bottles of wine.

Webster’s dictionary defines the word ‘predict’ as “foretell on the basis of observation, experience or scientific reason.”  We reviewed numerous resources for writing this blog and thought it might be most useful to provide you with a sampling of opinions touching several critical issues for all manufacturers.

 

Ten predictions for 2011 that will affect manufacturing and other sectors includes:

  • Manufacturing revenue is expected to increase by 5.6% in 2011.  However a large portion of the growth in sales revenue could likely be the result of price increases and not gains in volume.
  • Shippers will see freight costs (rates + fuel surcharge) rise over the course of 2011 by as much as 6% to 8%.  It is assumed that very few shippers are actually budgeting for these increases.
  • Export levels will continue to increase in 2011 as the dollar remains weak.  However the dollar may gain a little against the Euro due to the ongoing crisis in European countries.
  • Manufacturing capital investments in 2011 should jump by 14.5%, up from a 5.9% increase in 2010.
  • Manufacturers will see higher material costs of 4% for all of 2011 which could mean that margins don’t track higher as do sales.
  • Companies in the primary metals, fabricated metals and petroleum-product sectors are currently forecast to lead the manufacturing industry in sales growth in 2011.  However all three are highly sensitive to price changes in the supply chain.
  • The software market for tools in energy management is evolving with offerings targeted at general facilities, manufacturing processes and data centers.  Clear leaders in this market will emerge in 2011.
  • The gap between the various states regarding their budget deficits will widen considerably in 2011.  Those in the industrial Midwest will take the biggest hit along with California.
  • The unemployment rate for 2011 will remain high – between 9 and 10.3 percent.
  • The US economy as a whole will start to grow at between 2.6 and 3.2 percent and there will be no double dip in 2011.

In March of 2012 we will review the accuracy of these predictions.  But in the meantime – what do you think?  Do these predictions ring true based on your experience?

Do predictions help your company plan for the coming year – or not? We look forward to reading your comments – and thanks for stopping by EVERYTHING’S CONNECTED

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2 replies
  1. David Gordon
    David Gordon says:

    the revenue number is about right. We’ve heard flat to +5% from manufacturers and distributors, excluding price increases … so could be 3-8% in inflated dollars, depends upon market segment. Industrially-oriented manufacturers are on the high end. Commercial is will vary by market, with some large projects, more in renovation and limited “small – medium” projects. Resi, nationally, is still “challenged”

  2. David Gordon
    David Gordon says:

    the revenue number is about right. We’ve heard flat to +5% from manufacturers and distributors, excluding price increases … so could be 3-8% in inflated dollars, depends upon market segment. Industrially-oriented manufacturers are on the high end. Commercial is will vary by market, with some large projects, more in renovation and limited “small – medium” projects. Resi, nationally, is still “challenged”

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