While the COVID-19 pandemic made life difficult for a majority of local manufacturing companies, industry officials are still overwhelmingly optimistic when looking at the year ahead.
Those are two key takeaways from a recent survey conducted by MiBiz, which polled 332 manufacturers throughout West and Southwest Michigan. Respondents were primarily owners, executives and managers at small and middle-market manufacturing companies with fewer than 250 employees.
Perhaps unsurprisingly, 82 percent of respondents said that COVID-19 had a negative effect on their business in 2020 as supply chain and talent-related issues emerged as two of the biggest challenges.
When nailing down the specific ways in which the pandemic negatively affected their businesses, 72.8 percent of respondents said that sales and orders were down and 59 percent said they faced disruptions in the supply chain.
Despite the struggles, survey respondents were largely confident that business would return to some semblance of normalcy in 2021.
When asked how they thought their business would perform in 2021, 78 percent of respondents gave a positive answer. Of those, 30 percent forecasted their companies would continue on the same course and at the same speed as 2020, while 26 percent said they would return to pre-pandemic levels. Another 22 percent said their businesses would reach new heights in the upcoming year.
“Pivoting” was a recurring theme with manufacturers during the pandemic as companies refocused their capital equipment and proficiencies to capture new opportunities, like the production of personal protective equipment.
New opportunities also proved to be a reason for optimism for survey respondents.
In the survey, MiBiz asked respondents about those new opportunities and found that 53 percent increased remote work for some personnel, 37 percent said the pandemic inspired them to innovate, 29 percent said COVID-19 motivated them to accelerate strategic initiatives they were already working on, and another 22 percent said COVID pushed them to make their supply chain more resilient.
Local manufacturers also appear poised to make new investments in the coming years. Data from the survey revealed that automation and sales and marketing would be two points of emphasis for these businesses.
Of respondents, 23 percent said they plan to make major investments in sales and marketing and another 42 percent said they plan to make a minor investment in that area of their businesses. Additionally, 20 percent said they planned to make major investments in automation and 28 percent said they would make minor investments.
In conducting the survey, MiBiz collaborated with manufacturing executives associated with Inforum, a statewide networking and professional development group for women.
Some of the results were shared at a Feb. 24 event on “The Impact of COVID and Successfully Navigating Through the New Normal,” hosted by Inforum’s ManufacturingNEXT industry group.
News coverage in the manufacturing section of MiBiz is made possible by advertising support from The Michigan Economic Development Corporation. MEDC markets Michigan as the place to do business, assists businesses in their growth strategies and fosters the growth of vibrant communities across the state. This advertisement has no effect on editorial consideration in MiBiz.