More than half of Canadian manufacturers surveyed in PwC’s fourth-quarter 2011 Manufacturing Barometer study feel optimistic about the prospects for the Canadian economy over the next 12 months. With a 25% jump in confidence from the previous quarter, 90% of respondents expect positive revenue growth for their own companies, with 10% forecasting double-digit growth.
Across the board we’re seeing Canadian manufacturers with positive projections associated with company growth, international sales, and spending trends. One area of concentration is operational spending. Eighty per cent of Canadian respondents are hoping to increase spending in this area over the next year. Leading areas of increased spending are information technology (47%), research and development (47 %), and new product or service introductions (37%).
Manufacturing Barometer panelists expect international sales to contribute 66% of their total revenue over the next 12 months. Manufacturing companies looking to explore outside of Canada can experience a reduction in inventory, support local manufacturing and there may be foreign exchange advantages for the company. Simultaneously, manufacturers must adhere to enterprise risk management protocols that meet quality and delivery standards, while staying aware of foreign corruption activities and social responsibility practices.
At the same time, foreign market competition is cited by 43% of Canadian manufacturers surveyed as a barrier to growth. To reduce this barrier, initiatives such as new strategic alliances and joint ventures in markets abroad are on the minds of companies this year.
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