2008 Sourcing Needs Stayed Steady, 2009 Big Moves are on Hold

Looking at the past year, 69% of MFG Watch survey respondents said they had maintained or grown sourcing, and 82% indicated they expected to maintain or grow their businesses this year.

The MFGWatch survey is conducted by MFG.com, an Internet based platform that serves as a marketplace for the manufacturing industry. More than 200 purchasing professionals and engineers in the manufacturing industry participated in the survey. Industry segments covered everything from medical, oil and gas, aerospace, agriculture, automotives, food, mining consumer goods and more.

Of the 31% who indicated sourcing needs had decreased last year, half indicated they were currently seeking new suppliers and the other half said they were not augmenting their supply chain.

As far as where they were sourcing, 64% preferred to source with North American manufacturers, 19% favored China for their sourcing needs, and 7% conducted sourcing business in Europe. The remaining 10% were sourcing in South America, Africa and other countries.

Although a large number of respondents did not expect shrinkage in business during 2008, while just 11% did not cancel or postpone purchases, 35% stopped hiring new or replacement employees; 15% canceled software or upgrade purchases ; 12% suspended facility expansion in 2009; 15% cut business travel; and 8% did not renew memberships in professional societies or industry associations.

In response to current harsh economic time, 22% resorted to layoffs; 21% initiated a hiring freeze; 18% shortened shifts and work hours; 10% reduced the amount sourced at one time; 9% reduced the frequency of items sourced; 6% reported no changes in conducting business as usual; 5% closed facilities; and 4% added automation to reduce payroll.

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