Prime Advantage, a buying consortium for industrial manufacturers, conducted the 2010 Group CFO Survey to gain insight into the financial concerns of its member companies.
Widespread optimism about the economy in 2010 seems to coincide with U.S. Federal Reserve data showing growth in industrial output for the seventh consecutive month, according to Prime Advantage.
While 67% of respondents reported feeling more optimistic about the economy, customer demand remained the top external concern among 61% of respondents. Uncertainty over price pressures (28%) and federal government policies (19%) were other top concerns.
The Group CFO Survey shows that 64% of respondents believe the manufacturing economy will expand in 2010, but 91% said customers and prospects have been affected by cost or availability of credit.
Additionally, 57% reported that domestic employment in their plants will not return to year-end 2007 levels before 2011 or 2012. However, when asked whether they would hire new staff to meet an increased demand in 2010, 82% responded affirmatively.
Moreover, 70% said they would continue to cut operational costs, and 55% said they would develop new products and services. Slightly more than half (52%) said responding quickly to future economic changes and finding new markets are top priorities.
In January, Prime Advantage surveyed 80 finance executives from more than 25 industries, including commercial foodservice, packaging, truck/trailer, material handling, food processing and construction. The majority of responding firms have annual revenues between $20 million and $500 million.