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2017Manufacturing Industry
Outlook Report
OVERVIEWManufacturers are largely positive about where their industry is headingThat optimism has been fueled in part by the results of the 2016 electionsWith the Republicans taking control of the White House and bothchambers of Congress along with winning major gubernatorial victoriesacross the country the sector remains hopeful that there will be changesfavorable to US businesses
Promises of tax and health care reform decreased federal regulations andfairer trade agreements buoyed the public stock markets following theelection And the effects have trickled down to the private manufacturerswho responded to our survey
So far little headway has been made on the pro-business agenda TheTrump administration has encountered significant resistance andcontroversy As delays mount how long will manufacturers maintain theirsunny outlook Herersquos insight gathered straight from the trenches thisspring
Our survey revealed that manufacturers generally expect continuedgrowth in 2017 A significant source of growth will be existing USmarkets but new innovative products and services could add to the mixOther growth opportunities will come from external sources such asmergers and acquisitions
Companies also report a variety of challenges that threaten growthThese include weakening domestic demand a lack of qualified workersand rising operating costs such as the cost of providing health carecoverage for employees
EXECUTIVE SUMMARY
OVERVIEWManufacturers strive to control their costs and invest wisely to facilitategrowth strategies Many companies expect to increase their budgets formarketing and sales research and development capital expendituresand technology in 2017 These are more than routine operating expensesmdash theyrsquore investments in the future to drive continued revenue growth
Tax reform is a top concern for manufacturers but therersquos no singleproposal thatrsquos garnered the industryrsquos support Many respondents favorlower income tax rates for businesses and individuals But a significantnumber look unfavorably on such reforms as border taxes tariffs onimports elimination of the interest deduction and temporary relief forrepatriated foreign profits
Big questions remain as we head into the second half of 2017 WillCongress pass tax reform and other pro-business legislation in the comingmonths Or will they miss this unique opportunity to simplify the tax codeand make other changes that will enhance growth opportunities for USbusinesses Until these questions are answered manufacturers willoperate in an uncertain business environment
ldquoAlthough we are living in uncertain times it is good to see a continuedsense of optimism in the manufacturing sector The innovation that isbeing driven through our US manufacturers will continue to providegrowth opportunities globallyrdquo said Paul Oliveira Shareholder and Chairof KLRrsquos Manufacturing Services Group ldquoOf course there are alwayschallenges We hope that this survey will provide some insight onwhere those challenges mdash and potential solutions mdash lierdquo
REVENUE GROWTH
WHAT ARE YOUR EXPECTATIONS ONHOW YOUR INDUSTRY WILL PERFORMOVER THE NEXT 12 MONTHS
In general manufacturers are optimistic about industry growth prospects forthe coming year mdash even more so than in 2016
Negative sentiment remained consistent at 9 from 2016 to 2017 But positivesentiment grew from roughly one-third of respondents in 2016 to morethan half of the respondents in 2017
23
17
expect the year-over-year increase to exceed 534
REVENUE GROWTH
The following actions are the top company priorities for 2017
Increasing Share in Existing Markets
Developing New Products and Services in Response to Changing Consumption Patterns
Seeking New Markets for Products and Services
1
2
3
TOP BUSINESS PRIORITIES
Over the next 12 to 18 months 64 ofthe manufacturers surveyed expecttheir growth to come mainly fromincreased market share and organicgrowth in existing domestic marketsThese findings are consistent with theresponses from 2016
All three of these priorities are directlyrelated to revenue growth
REVENUE GROWTH
Under the current law the research credit has been made permanentMoreover this credit hasnrsquot yet been targeted by congressional tax reformproposals So itrsquos likely to continue to provide tax savings in the future
INVESTMENT IN RampD
One-fifth of respondentsare investing 6 or more oftheir revenue in
Mergers acquisitions joint ventures and strategic alliances are seen as atop growth opportunity by 16 of respondents But only 7 of respondentsare considering a merger or acquisition in 2017 compared to nearly 29 inthe previous survey
of respondents made a strategic acquisition during 2016
MampA ACTIVITY
developing new products
10
Tweet this
Projected RampD Spending as a Percentage of Revenue
CHALLENGES
Weaker Domestic Economyand Sales of Products
TOP 3 EXPECTED BARRIERS TO BUSINESSGROWTH IN 2017
1
Lack of Qualified Workers2Rising Health Care Costs3
BARRIERS TO GROWTH
OPERATIONAL COSTS
OPERATING COST EXPECTATIONS OVER THE NEXT 12 MONTHS
44 believe they will remain
the same47 believe
they will increase
Accordingly nearly 40 of respondents identify cutting operating costs as a top priority for 2017
SPENDING amp INVESTMENT
Technology investments are anothertop priority for many manufacturingfirms in 2017 Nearly 40 ofrespondents expect to upgradeinformation technology and roughlyone-third plan to invest inautomation to modernize theiroperations
BUSINESS DRIVERS IMPACTING TECHNOLOGY STRATEGIES
Implement a CRM Database
2
Enhance Data Security3
Invest in Social Media Capabilities 4
Improve Performance of Existing Systems
1
Add New ERP or Core Operating Systems5
40
The number of respondentsexpecting to increase spendingon Internet commerce fell from38 in 2016 to 17 in 2017 Thischange suggests that manymanufacturers have their e-commerce capabilities up andrunning
Marketing and Sales
EXECUTIVES EXPECT OPERATIONAL SPENDING IN 2017 TO INCREASE ON
1New Product or Service Introduction2Information Technology3Advertising4Automation5
OPERATIONAL SPENDING
TAXES amp TAX REFORM
OPERATING COST EXPECTATIONS OVER THE
NEXT 12 MONTHS
Taxes are always a hot button for businesses Before pursuing their capitalinvestment plans manufacturers may be waiting to see what happens inWashington with the promised pro-business changes to the tax code
51 say lowering corporate incometaxes would be ldquogoodrdquo or ldquoverygoodrdquo for the economy
11 say easing the repatriation offoreign profits would be ldquogoodrdquo orldquovery goodrdquo for the economy eventhough half of the respondentsoperate internationally
Manufacturers donrsquot universallyagree with all of the proposed taxreforms however
Lower the Top Personal Income Tax Rate to 30
2
Allow Immediate Deductions for New Investments
3
Ease the Repatriation of Foreign Profits 4
Lower the Corporate Income Tax Rate to 201
TOP PRO-BUSINESS TAX REFORMS
Tariffs on Chinese and Mexican Imports
TAX REFORM PROPOSALS THATTHREATEN THE ECONOMY
1
Border Taxes2Elimination of Interest Deduction on Debt3
Nearly 40 of respondentsoppose tariffs on imports andborder taxes One-quarterthink itrsquos in the best interestsof the economy for intereston debt to remain deductiblefor tax purposes
TOP PRO-BUSINESS TAX REFORMS
SURVEY amp RESPONDENTS
RESPONDENT OVERVIEW
KLRrsquos 2017 Manufacturing Industry Outlook Report is based on theresults of our confidential web-based survey that was conductedusing SurveyMonkeycom an online survey provider
From May 2 to May 31 2017 136 manufacturing companiesresponded to our survey It consisted of 18 questions about a widerange of topics such as growth expectations challenges andopportunities direct costs and capital expenditures
We solicited feedback primarily from owners CEOs and senior-level executives of New England manufacturing companies Inaddition we received responses from two companiesheadquartered in the West and three companies headquarteredoutside of the United States Of those surveyed 50 engaged ininternational operations
Most of the respondents had between $1 million to $50 million inannual revenue But there were a significant number of very smalland very large companies involved in the survey 15 had morethan $100 million in annual revenues
SURVEY amp RESPONDENTS
ANNUAL REVENUE
Roughly 70 of respondents had100 employees or fewer Mostoperated in four locationsworldwide (or fewer)
NUMBER OF LOCATIONS WORLDWIDE
lt1001 Location
_
Respondents also varied in size More than half of our responsescame from manufacturers with $20 million or less in annualrevenues But 15 had more than $100 million in annual revenues
Roughly 70 of respondents had 100 or fewer employees
Most operated in four locations worldwide (or fewer)
Number of Locations
12-4
5+
KLR is one of New Englandrsquos premier accounting and businessadvisory firms With 225+ team members and offices in BostonNewport Providence Shanghai and Waltham KLR provides a widerange of services to both individuals and businesses
Find out why KLR is so much more than an accounting firm atKahnLitwincom
SHARE THIS REPORT
888-KLR-8557 SO MUCH MORE THANAN ACCOUNTING FIRM
LOOKING TO THE FUTURE
Responses from New Englandrsquos manufacturing trenches are primarilyupbeat despite various potential roadblocks and uncertainty aboutpossible tax reforms Many companies are making investments to setthe stage for future growth
Contact us for help planning optimal short- and long-term strategiesbased on your size sector and available resources We can also helpto identify opportunities to control your costs anticipate and tackleobstacles evaluate investment opportunities and stay up-to-date onthe latest changes to federal regulations health care coveragerequirements and tax law
ABOUT US
SHARE OUR REPORT
OVERVIEWManufacturers are largely positive about where their industry is headingThat optimism has been fueled in part by the results of the 2016 electionsWith the Republicans taking control of the White House and bothchambers of Congress along with winning major gubernatorial victoriesacross the country the sector remains hopeful that there will be changesfavorable to US businesses
Promises of tax and health care reform decreased federal regulations andfairer trade agreements buoyed the public stock markets following theelection And the effects have trickled down to the private manufacturerswho responded to our survey
So far little headway has been made on the pro-business agenda TheTrump administration has encountered significant resistance andcontroversy As delays mount how long will manufacturers maintain theirsunny outlook Herersquos insight gathered straight from the trenches thisspring
Our survey revealed that manufacturers generally expect continuedgrowth in 2017 A significant source of growth will be existing USmarkets but new innovative products and services could add to the mixOther growth opportunities will come from external sources such asmergers and acquisitions
Companies also report a variety of challenges that threaten growthThese include weakening domestic demand a lack of qualified workersand rising operating costs such as the cost of providing health carecoverage for employees
EXECUTIVE SUMMARY
OVERVIEWManufacturers strive to control their costs and invest wisely to facilitategrowth strategies Many companies expect to increase their budgets formarketing and sales research and development capital expendituresand technology in 2017 These are more than routine operating expensesmdash theyrsquore investments in the future to drive continued revenue growth
Tax reform is a top concern for manufacturers but therersquos no singleproposal thatrsquos garnered the industryrsquos support Many respondents favorlower income tax rates for businesses and individuals But a significantnumber look unfavorably on such reforms as border taxes tariffs onimports elimination of the interest deduction and temporary relief forrepatriated foreign profits
Big questions remain as we head into the second half of 2017 WillCongress pass tax reform and other pro-business legislation in the comingmonths Or will they miss this unique opportunity to simplify the tax codeand make other changes that will enhance growth opportunities for USbusinesses Until these questions are answered manufacturers willoperate in an uncertain business environment
ldquoAlthough we are living in uncertain times it is good to see a continuedsense of optimism in the manufacturing sector The innovation that isbeing driven through our US manufacturers will continue to providegrowth opportunities globallyrdquo said Paul Oliveira Shareholder and Chairof KLRrsquos Manufacturing Services Group ldquoOf course there are alwayschallenges We hope that this survey will provide some insight onwhere those challenges mdash and potential solutions mdash lierdquo
REVENUE GROWTH
WHAT ARE YOUR EXPECTATIONS ONHOW YOUR INDUSTRY WILL PERFORMOVER THE NEXT 12 MONTHS
In general manufacturers are optimistic about industry growth prospects forthe coming year mdash even more so than in 2016
Negative sentiment remained consistent at 9 from 2016 to 2017 But positivesentiment grew from roughly one-third of respondents in 2016 to morethan half of the respondents in 2017
23
17
expect the year-over-year increase to exceed 534
REVENUE GROWTH
The following actions are the top company priorities for 2017
Increasing Share in Existing Markets
Developing New Products and Services in Response to Changing Consumption Patterns
Seeking New Markets for Products and Services
1
2
3
TOP BUSINESS PRIORITIES
Over the next 12 to 18 months 64 ofthe manufacturers surveyed expecttheir growth to come mainly fromincreased market share and organicgrowth in existing domestic marketsThese findings are consistent with theresponses from 2016
All three of these priorities are directlyrelated to revenue growth
REVENUE GROWTH
Under the current law the research credit has been made permanentMoreover this credit hasnrsquot yet been targeted by congressional tax reformproposals So itrsquos likely to continue to provide tax savings in the future
INVESTMENT IN RampD
One-fifth of respondentsare investing 6 or more oftheir revenue in
Mergers acquisitions joint ventures and strategic alliances are seen as atop growth opportunity by 16 of respondents But only 7 of respondentsare considering a merger or acquisition in 2017 compared to nearly 29 inthe previous survey
of respondents made a strategic acquisition during 2016
MampA ACTIVITY
developing new products
10
Tweet this
Projected RampD Spending as a Percentage of Revenue
CHALLENGES
Weaker Domestic Economyand Sales of Products
TOP 3 EXPECTED BARRIERS TO BUSINESSGROWTH IN 2017
1
Lack of Qualified Workers2Rising Health Care Costs3
BARRIERS TO GROWTH
OPERATIONAL COSTS
OPERATING COST EXPECTATIONS OVER THE NEXT 12 MONTHS
44 believe they will remain
the same47 believe
they will increase
Accordingly nearly 40 of respondents identify cutting operating costs as a top priority for 2017
SPENDING amp INVESTMENT
Technology investments are anothertop priority for many manufacturingfirms in 2017 Nearly 40 ofrespondents expect to upgradeinformation technology and roughlyone-third plan to invest inautomation to modernize theiroperations
BUSINESS DRIVERS IMPACTING TECHNOLOGY STRATEGIES
Implement a CRM Database
2
Enhance Data Security3
Invest in Social Media Capabilities 4
Improve Performance of Existing Systems
1
Add New ERP or Core Operating Systems5
40
The number of respondentsexpecting to increase spendingon Internet commerce fell from38 in 2016 to 17 in 2017 Thischange suggests that manymanufacturers have their e-commerce capabilities up andrunning
Marketing and Sales
EXECUTIVES EXPECT OPERATIONAL SPENDING IN 2017 TO INCREASE ON
1New Product or Service Introduction2Information Technology3Advertising4Automation5
OPERATIONAL SPENDING
TAXES amp TAX REFORM
OPERATING COST EXPECTATIONS OVER THE
NEXT 12 MONTHS
Taxes are always a hot button for businesses Before pursuing their capitalinvestment plans manufacturers may be waiting to see what happens inWashington with the promised pro-business changes to the tax code
51 say lowering corporate incometaxes would be ldquogoodrdquo or ldquoverygoodrdquo for the economy
11 say easing the repatriation offoreign profits would be ldquogoodrdquo orldquovery goodrdquo for the economy eventhough half of the respondentsoperate internationally
Manufacturers donrsquot universallyagree with all of the proposed taxreforms however
Lower the Top Personal Income Tax Rate to 30
2
Allow Immediate Deductions for New Investments
3
Ease the Repatriation of Foreign Profits 4
Lower the Corporate Income Tax Rate to 201
TOP PRO-BUSINESS TAX REFORMS
Tariffs on Chinese and Mexican Imports
TAX REFORM PROPOSALS THATTHREATEN THE ECONOMY
1
Border Taxes2Elimination of Interest Deduction on Debt3
Nearly 40 of respondentsoppose tariffs on imports andborder taxes One-quarterthink itrsquos in the best interestsof the economy for intereston debt to remain deductiblefor tax purposes
TOP PRO-BUSINESS TAX REFORMS
SURVEY amp RESPONDENTS
RESPONDENT OVERVIEW
KLRrsquos 2017 Manufacturing Industry Outlook Report is based on theresults of our confidential web-based survey that was conductedusing SurveyMonkeycom an online survey provider
From May 2 to May 31 2017 136 manufacturing companiesresponded to our survey It consisted of 18 questions about a widerange of topics such as growth expectations challenges andopportunities direct costs and capital expenditures
We solicited feedback primarily from owners CEOs and senior-level executives of New England manufacturing companies Inaddition we received responses from two companiesheadquartered in the West and three companies headquarteredoutside of the United States Of those surveyed 50 engaged ininternational operations
Most of the respondents had between $1 million to $50 million inannual revenue But there were a significant number of very smalland very large companies involved in the survey 15 had morethan $100 million in annual revenues
SURVEY amp RESPONDENTS
ANNUAL REVENUE
Roughly 70 of respondents had100 employees or fewer Mostoperated in four locationsworldwide (or fewer)
NUMBER OF LOCATIONS WORLDWIDE
lt1001 Location
_
Respondents also varied in size More than half of our responsescame from manufacturers with $20 million or less in annualrevenues But 15 had more than $100 million in annual revenues
Roughly 70 of respondents had 100 or fewer employees
Most operated in four locations worldwide (or fewer)
Number of Locations
12-4
5+
KLR is one of New Englandrsquos premier accounting and businessadvisory firms With 225+ team members and offices in BostonNewport Providence Shanghai and Waltham KLR provides a widerange of services to both individuals and businesses
Find out why KLR is so much more than an accounting firm atKahnLitwincom
SHARE THIS REPORT
888-KLR-8557 SO MUCH MORE THANAN ACCOUNTING FIRM
LOOKING TO THE FUTURE
Responses from New Englandrsquos manufacturing trenches are primarilyupbeat despite various potential roadblocks and uncertainty aboutpossible tax reforms Many companies are making investments to setthe stage for future growth
Contact us for help planning optimal short- and long-term strategiesbased on your size sector and available resources We can also helpto identify opportunities to control your costs anticipate and tackleobstacles evaluate investment opportunities and stay up-to-date onthe latest changes to federal regulations health care coveragerequirements and tax law
ABOUT US
SHARE OUR REPORT
OVERVIEWManufacturers strive to control their costs and invest wisely to facilitategrowth strategies Many companies expect to increase their budgets formarketing and sales research and development capital expendituresand technology in 2017 These are more than routine operating expensesmdash theyrsquore investments in the future to drive continued revenue growth
Tax reform is a top concern for manufacturers but therersquos no singleproposal thatrsquos garnered the industryrsquos support Many respondents favorlower income tax rates for businesses and individuals But a significantnumber look unfavorably on such reforms as border taxes tariffs onimports elimination of the interest deduction and temporary relief forrepatriated foreign profits
Big questions remain as we head into the second half of 2017 WillCongress pass tax reform and other pro-business legislation in the comingmonths Or will they miss this unique opportunity to simplify the tax codeand make other changes that will enhance growth opportunities for USbusinesses Until these questions are answered manufacturers willoperate in an uncertain business environment
ldquoAlthough we are living in uncertain times it is good to see a continuedsense of optimism in the manufacturing sector The innovation that isbeing driven through our US manufacturers will continue to providegrowth opportunities globallyrdquo said Paul Oliveira Shareholder and Chairof KLRrsquos Manufacturing Services Group ldquoOf course there are alwayschallenges We hope that this survey will provide some insight onwhere those challenges mdash and potential solutions mdash lierdquo
REVENUE GROWTH
WHAT ARE YOUR EXPECTATIONS ONHOW YOUR INDUSTRY WILL PERFORMOVER THE NEXT 12 MONTHS
In general manufacturers are optimistic about industry growth prospects forthe coming year mdash even more so than in 2016
Negative sentiment remained consistent at 9 from 2016 to 2017 But positivesentiment grew from roughly one-third of respondents in 2016 to morethan half of the respondents in 2017
23
17
expect the year-over-year increase to exceed 534
REVENUE GROWTH
The following actions are the top company priorities for 2017
Increasing Share in Existing Markets
Developing New Products and Services in Response to Changing Consumption Patterns
Seeking New Markets for Products and Services
1
2
3
TOP BUSINESS PRIORITIES
Over the next 12 to 18 months 64 ofthe manufacturers surveyed expecttheir growth to come mainly fromincreased market share and organicgrowth in existing domestic marketsThese findings are consistent with theresponses from 2016
All three of these priorities are directlyrelated to revenue growth
REVENUE GROWTH
Under the current law the research credit has been made permanentMoreover this credit hasnrsquot yet been targeted by congressional tax reformproposals So itrsquos likely to continue to provide tax savings in the future
INVESTMENT IN RampD
One-fifth of respondentsare investing 6 or more oftheir revenue in
Mergers acquisitions joint ventures and strategic alliances are seen as atop growth opportunity by 16 of respondents But only 7 of respondentsare considering a merger or acquisition in 2017 compared to nearly 29 inthe previous survey
of respondents made a strategic acquisition during 2016
MampA ACTIVITY
developing new products
10
Tweet this
Projected RampD Spending as a Percentage of Revenue
CHALLENGES
Weaker Domestic Economyand Sales of Products
TOP 3 EXPECTED BARRIERS TO BUSINESSGROWTH IN 2017
1
Lack of Qualified Workers2Rising Health Care Costs3
BARRIERS TO GROWTH
OPERATIONAL COSTS
OPERATING COST EXPECTATIONS OVER THE NEXT 12 MONTHS
44 believe they will remain
the same47 believe
they will increase
Accordingly nearly 40 of respondents identify cutting operating costs as a top priority for 2017
SPENDING amp INVESTMENT
Technology investments are anothertop priority for many manufacturingfirms in 2017 Nearly 40 ofrespondents expect to upgradeinformation technology and roughlyone-third plan to invest inautomation to modernize theiroperations
BUSINESS DRIVERS IMPACTING TECHNOLOGY STRATEGIES
Implement a CRM Database
2
Enhance Data Security3
Invest in Social Media Capabilities 4
Improve Performance of Existing Systems
1
Add New ERP or Core Operating Systems5
40
The number of respondentsexpecting to increase spendingon Internet commerce fell from38 in 2016 to 17 in 2017 Thischange suggests that manymanufacturers have their e-commerce capabilities up andrunning
Marketing and Sales
EXECUTIVES EXPECT OPERATIONAL SPENDING IN 2017 TO INCREASE ON
1New Product or Service Introduction2Information Technology3Advertising4Automation5
OPERATIONAL SPENDING
TAXES amp TAX REFORM
OPERATING COST EXPECTATIONS OVER THE
NEXT 12 MONTHS
Taxes are always a hot button for businesses Before pursuing their capitalinvestment plans manufacturers may be waiting to see what happens inWashington with the promised pro-business changes to the tax code
51 say lowering corporate incometaxes would be ldquogoodrdquo or ldquoverygoodrdquo for the economy
11 say easing the repatriation offoreign profits would be ldquogoodrdquo orldquovery goodrdquo for the economy eventhough half of the respondentsoperate internationally
Manufacturers donrsquot universallyagree with all of the proposed taxreforms however
Lower the Top Personal Income Tax Rate to 30
2
Allow Immediate Deductions for New Investments
3
Ease the Repatriation of Foreign Profits 4
Lower the Corporate Income Tax Rate to 201
TOP PRO-BUSINESS TAX REFORMS
Tariffs on Chinese and Mexican Imports
TAX REFORM PROPOSALS THATTHREATEN THE ECONOMY
1
Border Taxes2Elimination of Interest Deduction on Debt3
Nearly 40 of respondentsoppose tariffs on imports andborder taxes One-quarterthink itrsquos in the best interestsof the economy for intereston debt to remain deductiblefor tax purposes
TOP PRO-BUSINESS TAX REFORMS
SURVEY amp RESPONDENTS
RESPONDENT OVERVIEW
KLRrsquos 2017 Manufacturing Industry Outlook Report is based on theresults of our confidential web-based survey that was conductedusing SurveyMonkeycom an online survey provider
From May 2 to May 31 2017 136 manufacturing companiesresponded to our survey It consisted of 18 questions about a widerange of topics such as growth expectations challenges andopportunities direct costs and capital expenditures
We solicited feedback primarily from owners CEOs and senior-level executives of New England manufacturing companies Inaddition we received responses from two companiesheadquartered in the West and three companies headquarteredoutside of the United States Of those surveyed 50 engaged ininternational operations
Most of the respondents had between $1 million to $50 million inannual revenue But there were a significant number of very smalland very large companies involved in the survey 15 had morethan $100 million in annual revenues
SURVEY amp RESPONDENTS
ANNUAL REVENUE
Roughly 70 of respondents had100 employees or fewer Mostoperated in four locationsworldwide (or fewer)
NUMBER OF LOCATIONS WORLDWIDE
lt1001 Location
_
Respondents also varied in size More than half of our responsescame from manufacturers with $20 million or less in annualrevenues But 15 had more than $100 million in annual revenues
Roughly 70 of respondents had 100 or fewer employees
Most operated in four locations worldwide (or fewer)
Number of Locations
12-4
5+
KLR is one of New Englandrsquos premier accounting and businessadvisory firms With 225+ team members and offices in BostonNewport Providence Shanghai and Waltham KLR provides a widerange of services to both individuals and businesses
Find out why KLR is so much more than an accounting firm atKahnLitwincom
SHARE THIS REPORT
888-KLR-8557 SO MUCH MORE THANAN ACCOUNTING FIRM
LOOKING TO THE FUTURE
Responses from New Englandrsquos manufacturing trenches are primarilyupbeat despite various potential roadblocks and uncertainty aboutpossible tax reforms Many companies are making investments to setthe stage for future growth
Contact us for help planning optimal short- and long-term strategiesbased on your size sector and available resources We can also helpto identify opportunities to control your costs anticipate and tackleobstacles evaluate investment opportunities and stay up-to-date onthe latest changes to federal regulations health care coveragerequirements and tax law
ABOUT US
SHARE OUR REPORT
REVENUE GROWTH
WHAT ARE YOUR EXPECTATIONS ONHOW YOUR INDUSTRY WILL PERFORMOVER THE NEXT 12 MONTHS
In general manufacturers are optimistic about industry growth prospects forthe coming year mdash even more so than in 2016
Negative sentiment remained consistent at 9 from 2016 to 2017 But positivesentiment grew from roughly one-third of respondents in 2016 to morethan half of the respondents in 2017
23
17
expect the year-over-year increase to exceed 534
REVENUE GROWTH
The following actions are the top company priorities for 2017
Increasing Share in Existing Markets
Developing New Products and Services in Response to Changing Consumption Patterns
Seeking New Markets for Products and Services
1
2
3
TOP BUSINESS PRIORITIES
Over the next 12 to 18 months 64 ofthe manufacturers surveyed expecttheir growth to come mainly fromincreased market share and organicgrowth in existing domestic marketsThese findings are consistent with theresponses from 2016
All three of these priorities are directlyrelated to revenue growth
REVENUE GROWTH
Under the current law the research credit has been made permanentMoreover this credit hasnrsquot yet been targeted by congressional tax reformproposals So itrsquos likely to continue to provide tax savings in the future
INVESTMENT IN RampD
One-fifth of respondentsare investing 6 or more oftheir revenue in
Mergers acquisitions joint ventures and strategic alliances are seen as atop growth opportunity by 16 of respondents But only 7 of respondentsare considering a merger or acquisition in 2017 compared to nearly 29 inthe previous survey
of respondents made a strategic acquisition during 2016
MampA ACTIVITY
developing new products
10
Tweet this
Projected RampD Spending as a Percentage of Revenue
CHALLENGES
Weaker Domestic Economyand Sales of Products
TOP 3 EXPECTED BARRIERS TO BUSINESSGROWTH IN 2017
1
Lack of Qualified Workers2Rising Health Care Costs3
BARRIERS TO GROWTH
OPERATIONAL COSTS
OPERATING COST EXPECTATIONS OVER THE NEXT 12 MONTHS
44 believe they will remain
the same47 believe
they will increase
Accordingly nearly 40 of respondents identify cutting operating costs as a top priority for 2017
SPENDING amp INVESTMENT
Technology investments are anothertop priority for many manufacturingfirms in 2017 Nearly 40 ofrespondents expect to upgradeinformation technology and roughlyone-third plan to invest inautomation to modernize theiroperations
BUSINESS DRIVERS IMPACTING TECHNOLOGY STRATEGIES
Implement a CRM Database
2
Enhance Data Security3
Invest in Social Media Capabilities 4
Improve Performance of Existing Systems
1
Add New ERP or Core Operating Systems5
40
The number of respondentsexpecting to increase spendingon Internet commerce fell from38 in 2016 to 17 in 2017 Thischange suggests that manymanufacturers have their e-commerce capabilities up andrunning
Marketing and Sales
EXECUTIVES EXPECT OPERATIONAL SPENDING IN 2017 TO INCREASE ON
1New Product or Service Introduction2Information Technology3Advertising4Automation5
OPERATIONAL SPENDING
TAXES amp TAX REFORM
OPERATING COST EXPECTATIONS OVER THE
NEXT 12 MONTHS
Taxes are always a hot button for businesses Before pursuing their capitalinvestment plans manufacturers may be waiting to see what happens inWashington with the promised pro-business changes to the tax code
51 say lowering corporate incometaxes would be ldquogoodrdquo or ldquoverygoodrdquo for the economy
11 say easing the repatriation offoreign profits would be ldquogoodrdquo orldquovery goodrdquo for the economy eventhough half of the respondentsoperate internationally
Manufacturers donrsquot universallyagree with all of the proposed taxreforms however
Lower the Top Personal Income Tax Rate to 30
2
Allow Immediate Deductions for New Investments
3
Ease the Repatriation of Foreign Profits 4
Lower the Corporate Income Tax Rate to 201
TOP PRO-BUSINESS TAX REFORMS
Tariffs on Chinese and Mexican Imports
TAX REFORM PROPOSALS THATTHREATEN THE ECONOMY
1
Border Taxes2Elimination of Interest Deduction on Debt3
Nearly 40 of respondentsoppose tariffs on imports andborder taxes One-quarterthink itrsquos in the best interestsof the economy for intereston debt to remain deductiblefor tax purposes
TOP PRO-BUSINESS TAX REFORMS
SURVEY amp RESPONDENTS
RESPONDENT OVERVIEW
KLRrsquos 2017 Manufacturing Industry Outlook Report is based on theresults of our confidential web-based survey that was conductedusing SurveyMonkeycom an online survey provider
From May 2 to May 31 2017 136 manufacturing companiesresponded to our survey It consisted of 18 questions about a widerange of topics such as growth expectations challenges andopportunities direct costs and capital expenditures
We solicited feedback primarily from owners CEOs and senior-level executives of New England manufacturing companies Inaddition we received responses from two companiesheadquartered in the West and three companies headquarteredoutside of the United States Of those surveyed 50 engaged ininternational operations
Most of the respondents had between $1 million to $50 million inannual revenue But there were a significant number of very smalland very large companies involved in the survey 15 had morethan $100 million in annual revenues
SURVEY amp RESPONDENTS
ANNUAL REVENUE
Roughly 70 of respondents had100 employees or fewer Mostoperated in four locationsworldwide (or fewer)
NUMBER OF LOCATIONS WORLDWIDE
lt1001 Location
_
Respondents also varied in size More than half of our responsescame from manufacturers with $20 million or less in annualrevenues But 15 had more than $100 million in annual revenues
Roughly 70 of respondents had 100 or fewer employees
Most operated in four locations worldwide (or fewer)
Number of Locations
12-4
5+
KLR is one of New Englandrsquos premier accounting and businessadvisory firms With 225+ team members and offices in BostonNewport Providence Shanghai and Waltham KLR provides a widerange of services to both individuals and businesses
Find out why KLR is so much more than an accounting firm atKahnLitwincom
SHARE THIS REPORT
888-KLR-8557 SO MUCH MORE THANAN ACCOUNTING FIRM
LOOKING TO THE FUTURE
Responses from New Englandrsquos manufacturing trenches are primarilyupbeat despite various potential roadblocks and uncertainty aboutpossible tax reforms Many companies are making investments to setthe stage for future growth
Contact us for help planning optimal short- and long-term strategiesbased on your size sector and available resources We can also helpto identify opportunities to control your costs anticipate and tackleobstacles evaluate investment opportunities and stay up-to-date onthe latest changes to federal regulations health care coveragerequirements and tax law
ABOUT US
SHARE OUR REPORT
REVENUE GROWTH
The following actions are the top company priorities for 2017
Increasing Share in Existing Markets
Developing New Products and Services in Response to Changing Consumption Patterns
Seeking New Markets for Products and Services
1
2
3
TOP BUSINESS PRIORITIES
Over the next 12 to 18 months 64 ofthe manufacturers surveyed expecttheir growth to come mainly fromincreased market share and organicgrowth in existing domestic marketsThese findings are consistent with theresponses from 2016
All three of these priorities are directlyrelated to revenue growth
REVENUE GROWTH
Under the current law the research credit has been made permanentMoreover this credit hasnrsquot yet been targeted by congressional tax reformproposals So itrsquos likely to continue to provide tax savings in the future
INVESTMENT IN RampD
One-fifth of respondentsare investing 6 or more oftheir revenue in
Mergers acquisitions joint ventures and strategic alliances are seen as atop growth opportunity by 16 of respondents But only 7 of respondentsare considering a merger or acquisition in 2017 compared to nearly 29 inthe previous survey
of respondents made a strategic acquisition during 2016
MampA ACTIVITY
developing new products
10
Tweet this
Projected RampD Spending as a Percentage of Revenue
CHALLENGES
Weaker Domestic Economyand Sales of Products
TOP 3 EXPECTED BARRIERS TO BUSINESSGROWTH IN 2017
1
Lack of Qualified Workers2Rising Health Care Costs3
BARRIERS TO GROWTH
OPERATIONAL COSTS
OPERATING COST EXPECTATIONS OVER THE NEXT 12 MONTHS
44 believe they will remain
the same47 believe
they will increase
Accordingly nearly 40 of respondents identify cutting operating costs as a top priority for 2017
SPENDING amp INVESTMENT
Technology investments are anothertop priority for many manufacturingfirms in 2017 Nearly 40 ofrespondents expect to upgradeinformation technology and roughlyone-third plan to invest inautomation to modernize theiroperations
BUSINESS DRIVERS IMPACTING TECHNOLOGY STRATEGIES
Implement a CRM Database
2
Enhance Data Security3
Invest in Social Media Capabilities 4
Improve Performance of Existing Systems
1
Add New ERP or Core Operating Systems5
40
The number of respondentsexpecting to increase spendingon Internet commerce fell from38 in 2016 to 17 in 2017 Thischange suggests that manymanufacturers have their e-commerce capabilities up andrunning
Marketing and Sales
EXECUTIVES EXPECT OPERATIONAL SPENDING IN 2017 TO INCREASE ON
1New Product or Service Introduction2Information Technology3Advertising4Automation5
OPERATIONAL SPENDING
TAXES amp TAX REFORM
OPERATING COST EXPECTATIONS OVER THE
NEXT 12 MONTHS
Taxes are always a hot button for businesses Before pursuing their capitalinvestment plans manufacturers may be waiting to see what happens inWashington with the promised pro-business changes to the tax code
51 say lowering corporate incometaxes would be ldquogoodrdquo or ldquoverygoodrdquo for the economy
11 say easing the repatriation offoreign profits would be ldquogoodrdquo orldquovery goodrdquo for the economy eventhough half of the respondentsoperate internationally
Manufacturers donrsquot universallyagree with all of the proposed taxreforms however
Lower the Top Personal Income Tax Rate to 30
2
Allow Immediate Deductions for New Investments
3
Ease the Repatriation of Foreign Profits 4
Lower the Corporate Income Tax Rate to 201
TOP PRO-BUSINESS TAX REFORMS
Tariffs on Chinese and Mexican Imports
TAX REFORM PROPOSALS THATTHREATEN THE ECONOMY
1
Border Taxes2Elimination of Interest Deduction on Debt3
Nearly 40 of respondentsoppose tariffs on imports andborder taxes One-quarterthink itrsquos in the best interestsof the economy for intereston debt to remain deductiblefor tax purposes
TOP PRO-BUSINESS TAX REFORMS
SURVEY amp RESPONDENTS
RESPONDENT OVERVIEW
KLRrsquos 2017 Manufacturing Industry Outlook Report is based on theresults of our confidential web-based survey that was conductedusing SurveyMonkeycom an online survey provider
From May 2 to May 31 2017 136 manufacturing companiesresponded to our survey It consisted of 18 questions about a widerange of topics such as growth expectations challenges andopportunities direct costs and capital expenditures
We solicited feedback primarily from owners CEOs and senior-level executives of New England manufacturing companies Inaddition we received responses from two companiesheadquartered in the West and three companies headquarteredoutside of the United States Of those surveyed 50 engaged ininternational operations
Most of the respondents had between $1 million to $50 million inannual revenue But there were a significant number of very smalland very large companies involved in the survey 15 had morethan $100 million in annual revenues
SURVEY amp RESPONDENTS
ANNUAL REVENUE
Roughly 70 of respondents had100 employees or fewer Mostoperated in four locationsworldwide (or fewer)
NUMBER OF LOCATIONS WORLDWIDE
lt1001 Location
_
Respondents also varied in size More than half of our responsescame from manufacturers with $20 million or less in annualrevenues But 15 had more than $100 million in annual revenues
Roughly 70 of respondents had 100 or fewer employees
Most operated in four locations worldwide (or fewer)
Number of Locations
12-4
5+
KLR is one of New Englandrsquos premier accounting and businessadvisory firms With 225+ team members and offices in BostonNewport Providence Shanghai and Waltham KLR provides a widerange of services to both individuals and businesses
Find out why KLR is so much more than an accounting firm atKahnLitwincom
SHARE THIS REPORT
888-KLR-8557 SO MUCH MORE THANAN ACCOUNTING FIRM
LOOKING TO THE FUTURE
Responses from New Englandrsquos manufacturing trenches are primarilyupbeat despite various potential roadblocks and uncertainty aboutpossible tax reforms Many companies are making investments to setthe stage for future growth
Contact us for help planning optimal short- and long-term strategiesbased on your size sector and available resources We can also helpto identify opportunities to control your costs anticipate and tackleobstacles evaluate investment opportunities and stay up-to-date onthe latest changes to federal regulations health care coveragerequirements and tax law
ABOUT US
SHARE OUR REPORT
REVENUE GROWTH
Under the current law the research credit has been made permanentMoreover this credit hasnrsquot yet been targeted by congressional tax reformproposals So itrsquos likely to continue to provide tax savings in the future
INVESTMENT IN RampD
One-fifth of respondentsare investing 6 or more oftheir revenue in
Mergers acquisitions joint ventures and strategic alliances are seen as atop growth opportunity by 16 of respondents But only 7 of respondentsare considering a merger or acquisition in 2017 compared to nearly 29 inthe previous survey
of respondents made a strategic acquisition during 2016
MampA ACTIVITY
developing new products
10
Tweet this
Projected RampD Spending as a Percentage of Revenue
CHALLENGES
Weaker Domestic Economyand Sales of Products
TOP 3 EXPECTED BARRIERS TO BUSINESSGROWTH IN 2017
1
Lack of Qualified Workers2Rising Health Care Costs3
BARRIERS TO GROWTH
OPERATIONAL COSTS
OPERATING COST EXPECTATIONS OVER THE NEXT 12 MONTHS
44 believe they will remain
the same47 believe
they will increase
Accordingly nearly 40 of respondents identify cutting operating costs as a top priority for 2017
SPENDING amp INVESTMENT
Technology investments are anothertop priority for many manufacturingfirms in 2017 Nearly 40 ofrespondents expect to upgradeinformation technology and roughlyone-third plan to invest inautomation to modernize theiroperations
BUSINESS DRIVERS IMPACTING TECHNOLOGY STRATEGIES
Implement a CRM Database
2
Enhance Data Security3
Invest in Social Media Capabilities 4
Improve Performance of Existing Systems
1
Add New ERP or Core Operating Systems5
40
The number of respondentsexpecting to increase spendingon Internet commerce fell from38 in 2016 to 17 in 2017 Thischange suggests that manymanufacturers have their e-commerce capabilities up andrunning
Marketing and Sales
EXECUTIVES EXPECT OPERATIONAL SPENDING IN 2017 TO INCREASE ON
1New Product or Service Introduction2Information Technology3Advertising4Automation5
OPERATIONAL SPENDING
TAXES amp TAX REFORM
OPERATING COST EXPECTATIONS OVER THE
NEXT 12 MONTHS
Taxes are always a hot button for businesses Before pursuing their capitalinvestment plans manufacturers may be waiting to see what happens inWashington with the promised pro-business changes to the tax code
51 say lowering corporate incometaxes would be ldquogoodrdquo or ldquoverygoodrdquo for the economy
11 say easing the repatriation offoreign profits would be ldquogoodrdquo orldquovery goodrdquo for the economy eventhough half of the respondentsoperate internationally
Manufacturers donrsquot universallyagree with all of the proposed taxreforms however
Lower the Top Personal Income Tax Rate to 30
2
Allow Immediate Deductions for New Investments
3
Ease the Repatriation of Foreign Profits 4
Lower the Corporate Income Tax Rate to 201
TOP PRO-BUSINESS TAX REFORMS
Tariffs on Chinese and Mexican Imports
TAX REFORM PROPOSALS THATTHREATEN THE ECONOMY
1
Border Taxes2Elimination of Interest Deduction on Debt3
Nearly 40 of respondentsoppose tariffs on imports andborder taxes One-quarterthink itrsquos in the best interestsof the economy for intereston debt to remain deductiblefor tax purposes
TOP PRO-BUSINESS TAX REFORMS
SURVEY amp RESPONDENTS
RESPONDENT OVERVIEW
KLRrsquos 2017 Manufacturing Industry Outlook Report is based on theresults of our confidential web-based survey that was conductedusing SurveyMonkeycom an online survey provider
From May 2 to May 31 2017 136 manufacturing companiesresponded to our survey It consisted of 18 questions about a widerange of topics such as growth expectations challenges andopportunities direct costs and capital expenditures
We solicited feedback primarily from owners CEOs and senior-level executives of New England manufacturing companies Inaddition we received responses from two companiesheadquartered in the West and three companies headquarteredoutside of the United States Of those surveyed 50 engaged ininternational operations
Most of the respondents had between $1 million to $50 million inannual revenue But there were a significant number of very smalland very large companies involved in the survey 15 had morethan $100 million in annual revenues
SURVEY amp RESPONDENTS
ANNUAL REVENUE
Roughly 70 of respondents had100 employees or fewer Mostoperated in four locationsworldwide (or fewer)
NUMBER OF LOCATIONS WORLDWIDE
lt1001 Location
_
Respondents also varied in size More than half of our responsescame from manufacturers with $20 million or less in annualrevenues But 15 had more than $100 million in annual revenues
Roughly 70 of respondents had 100 or fewer employees
Most operated in four locations worldwide (or fewer)
Number of Locations
12-4
5+
KLR is one of New Englandrsquos premier accounting and businessadvisory firms With 225+ team members and offices in BostonNewport Providence Shanghai and Waltham KLR provides a widerange of services to both individuals and businesses
Find out why KLR is so much more than an accounting firm atKahnLitwincom
SHARE THIS REPORT
888-KLR-8557 SO MUCH MORE THANAN ACCOUNTING FIRM
LOOKING TO THE FUTURE
Responses from New Englandrsquos manufacturing trenches are primarilyupbeat despite various potential roadblocks and uncertainty aboutpossible tax reforms Many companies are making investments to setthe stage for future growth
Contact us for help planning optimal short- and long-term strategiesbased on your size sector and available resources We can also helpto identify opportunities to control your costs anticipate and tackleobstacles evaluate investment opportunities and stay up-to-date onthe latest changes to federal regulations health care coveragerequirements and tax law
ABOUT US
SHARE OUR REPORT
CHALLENGES
Weaker Domestic Economyand Sales of Products
TOP 3 EXPECTED BARRIERS TO BUSINESSGROWTH IN 2017
1
Lack of Qualified Workers2Rising Health Care Costs3
BARRIERS TO GROWTH
OPERATIONAL COSTS
OPERATING COST EXPECTATIONS OVER THE NEXT 12 MONTHS
44 believe they will remain
the same47 believe
they will increase
Accordingly nearly 40 of respondents identify cutting operating costs as a top priority for 2017
SPENDING amp INVESTMENT
Technology investments are anothertop priority for many manufacturingfirms in 2017 Nearly 40 ofrespondents expect to upgradeinformation technology and roughlyone-third plan to invest inautomation to modernize theiroperations
BUSINESS DRIVERS IMPACTING TECHNOLOGY STRATEGIES
Implement a CRM Database
2
Enhance Data Security3
Invest in Social Media Capabilities 4
Improve Performance of Existing Systems
1
Add New ERP or Core Operating Systems5
40
The number of respondentsexpecting to increase spendingon Internet commerce fell from38 in 2016 to 17 in 2017 Thischange suggests that manymanufacturers have their e-commerce capabilities up andrunning
Marketing and Sales
EXECUTIVES EXPECT OPERATIONAL SPENDING IN 2017 TO INCREASE ON
1New Product or Service Introduction2Information Technology3Advertising4Automation5
OPERATIONAL SPENDING
TAXES amp TAX REFORM
OPERATING COST EXPECTATIONS OVER THE
NEXT 12 MONTHS
Taxes are always a hot button for businesses Before pursuing their capitalinvestment plans manufacturers may be waiting to see what happens inWashington with the promised pro-business changes to the tax code
51 say lowering corporate incometaxes would be ldquogoodrdquo or ldquoverygoodrdquo for the economy
11 say easing the repatriation offoreign profits would be ldquogoodrdquo orldquovery goodrdquo for the economy eventhough half of the respondentsoperate internationally
Manufacturers donrsquot universallyagree with all of the proposed taxreforms however
Lower the Top Personal Income Tax Rate to 30
2
Allow Immediate Deductions for New Investments
3
Ease the Repatriation of Foreign Profits 4
Lower the Corporate Income Tax Rate to 201
TOP PRO-BUSINESS TAX REFORMS
Tariffs on Chinese and Mexican Imports
TAX REFORM PROPOSALS THATTHREATEN THE ECONOMY
1
Border Taxes2Elimination of Interest Deduction on Debt3
Nearly 40 of respondentsoppose tariffs on imports andborder taxes One-quarterthink itrsquos in the best interestsof the economy for intereston debt to remain deductiblefor tax purposes
TOP PRO-BUSINESS TAX REFORMS
SURVEY amp RESPONDENTS
RESPONDENT OVERVIEW
KLRrsquos 2017 Manufacturing Industry Outlook Report is based on theresults of our confidential web-based survey that was conductedusing SurveyMonkeycom an online survey provider
From May 2 to May 31 2017 136 manufacturing companiesresponded to our survey It consisted of 18 questions about a widerange of topics such as growth expectations challenges andopportunities direct costs and capital expenditures
We solicited feedback primarily from owners CEOs and senior-level executives of New England manufacturing companies Inaddition we received responses from two companiesheadquartered in the West and three companies headquarteredoutside of the United States Of those surveyed 50 engaged ininternational operations
Most of the respondents had between $1 million to $50 million inannual revenue But there were a significant number of very smalland very large companies involved in the survey 15 had morethan $100 million in annual revenues
SURVEY amp RESPONDENTS
ANNUAL REVENUE
Roughly 70 of respondents had100 employees or fewer Mostoperated in four locationsworldwide (or fewer)
NUMBER OF LOCATIONS WORLDWIDE
lt1001 Location
_
Respondents also varied in size More than half of our responsescame from manufacturers with $20 million or less in annualrevenues But 15 had more than $100 million in annual revenues
Roughly 70 of respondents had 100 or fewer employees
Most operated in four locations worldwide (or fewer)
Number of Locations
12-4
5+
KLR is one of New Englandrsquos premier accounting and businessadvisory firms With 225+ team members and offices in BostonNewport Providence Shanghai and Waltham KLR provides a widerange of services to both individuals and businesses
Find out why KLR is so much more than an accounting firm atKahnLitwincom
SHARE THIS REPORT
888-KLR-8557 SO MUCH MORE THANAN ACCOUNTING FIRM
LOOKING TO THE FUTURE
Responses from New Englandrsquos manufacturing trenches are primarilyupbeat despite various potential roadblocks and uncertainty aboutpossible tax reforms Many companies are making investments to setthe stage for future growth
Contact us for help planning optimal short- and long-term strategiesbased on your size sector and available resources We can also helpto identify opportunities to control your costs anticipate and tackleobstacles evaluate investment opportunities and stay up-to-date onthe latest changes to federal regulations health care coveragerequirements and tax law
ABOUT US
SHARE OUR REPORT
SPENDING amp INVESTMENT
Technology investments are anothertop priority for many manufacturingfirms in 2017 Nearly 40 ofrespondents expect to upgradeinformation technology and roughlyone-third plan to invest inautomation to modernize theiroperations
BUSINESS DRIVERS IMPACTING TECHNOLOGY STRATEGIES
Implement a CRM Database
2
Enhance Data Security3
Invest in Social Media Capabilities 4
Improve Performance of Existing Systems
1
Add New ERP or Core Operating Systems5
40
The number of respondentsexpecting to increase spendingon Internet commerce fell from38 in 2016 to 17 in 2017 Thischange suggests that manymanufacturers have their e-commerce capabilities up andrunning
Marketing and Sales
EXECUTIVES EXPECT OPERATIONAL SPENDING IN 2017 TO INCREASE ON
1New Product or Service Introduction2Information Technology3Advertising4Automation5
OPERATIONAL SPENDING
TAXES amp TAX REFORM
OPERATING COST EXPECTATIONS OVER THE
NEXT 12 MONTHS
Taxes are always a hot button for businesses Before pursuing their capitalinvestment plans manufacturers may be waiting to see what happens inWashington with the promised pro-business changes to the tax code
51 say lowering corporate incometaxes would be ldquogoodrdquo or ldquoverygoodrdquo for the economy
11 say easing the repatriation offoreign profits would be ldquogoodrdquo orldquovery goodrdquo for the economy eventhough half of the respondentsoperate internationally
Manufacturers donrsquot universallyagree with all of the proposed taxreforms however
Lower the Top Personal Income Tax Rate to 30
2
Allow Immediate Deductions for New Investments
3
Ease the Repatriation of Foreign Profits 4
Lower the Corporate Income Tax Rate to 201
TOP PRO-BUSINESS TAX REFORMS
Tariffs on Chinese and Mexican Imports
TAX REFORM PROPOSALS THATTHREATEN THE ECONOMY
1
Border Taxes2Elimination of Interest Deduction on Debt3
Nearly 40 of respondentsoppose tariffs on imports andborder taxes One-quarterthink itrsquos in the best interestsof the economy for intereston debt to remain deductiblefor tax purposes
TOP PRO-BUSINESS TAX REFORMS
SURVEY amp RESPONDENTS
RESPONDENT OVERVIEW
KLRrsquos 2017 Manufacturing Industry Outlook Report is based on theresults of our confidential web-based survey that was conductedusing SurveyMonkeycom an online survey provider
From May 2 to May 31 2017 136 manufacturing companiesresponded to our survey It consisted of 18 questions about a widerange of topics such as growth expectations challenges andopportunities direct costs and capital expenditures
We solicited feedback primarily from owners CEOs and senior-level executives of New England manufacturing companies Inaddition we received responses from two companiesheadquartered in the West and three companies headquarteredoutside of the United States Of those surveyed 50 engaged ininternational operations
Most of the respondents had between $1 million to $50 million inannual revenue But there were a significant number of very smalland very large companies involved in the survey 15 had morethan $100 million in annual revenues
SURVEY amp RESPONDENTS
ANNUAL REVENUE
Roughly 70 of respondents had100 employees or fewer Mostoperated in four locationsworldwide (or fewer)
NUMBER OF LOCATIONS WORLDWIDE
lt1001 Location
_
Respondents also varied in size More than half of our responsescame from manufacturers with $20 million or less in annualrevenues But 15 had more than $100 million in annual revenues
Roughly 70 of respondents had 100 or fewer employees
Most operated in four locations worldwide (or fewer)
Number of Locations
12-4
5+
KLR is one of New Englandrsquos premier accounting and businessadvisory firms With 225+ team members and offices in BostonNewport Providence Shanghai and Waltham KLR provides a widerange of services to both individuals and businesses
Find out why KLR is so much more than an accounting firm atKahnLitwincom
SHARE THIS REPORT
888-KLR-8557 SO MUCH MORE THANAN ACCOUNTING FIRM
LOOKING TO THE FUTURE
Responses from New Englandrsquos manufacturing trenches are primarilyupbeat despite various potential roadblocks and uncertainty aboutpossible tax reforms Many companies are making investments to setthe stage for future growth
Contact us for help planning optimal short- and long-term strategiesbased on your size sector and available resources We can also helpto identify opportunities to control your costs anticipate and tackleobstacles evaluate investment opportunities and stay up-to-date onthe latest changes to federal regulations health care coveragerequirements and tax law
ABOUT US
SHARE OUR REPORT
TAXES amp TAX REFORM
OPERATING COST EXPECTATIONS OVER THE
NEXT 12 MONTHS
Taxes are always a hot button for businesses Before pursuing their capitalinvestment plans manufacturers may be waiting to see what happens inWashington with the promised pro-business changes to the tax code
51 say lowering corporate incometaxes would be ldquogoodrdquo or ldquoverygoodrdquo for the economy
11 say easing the repatriation offoreign profits would be ldquogoodrdquo orldquovery goodrdquo for the economy eventhough half of the respondentsoperate internationally
Manufacturers donrsquot universallyagree with all of the proposed taxreforms however
Lower the Top Personal Income Tax Rate to 30
2
Allow Immediate Deductions for New Investments
3
Ease the Repatriation of Foreign Profits 4
Lower the Corporate Income Tax Rate to 201
TOP PRO-BUSINESS TAX REFORMS
Tariffs on Chinese and Mexican Imports
TAX REFORM PROPOSALS THATTHREATEN THE ECONOMY
1
Border Taxes2Elimination of Interest Deduction on Debt3
Nearly 40 of respondentsoppose tariffs on imports andborder taxes One-quarterthink itrsquos in the best interestsof the economy for intereston debt to remain deductiblefor tax purposes
TOP PRO-BUSINESS TAX REFORMS
SURVEY amp RESPONDENTS
RESPONDENT OVERVIEW
KLRrsquos 2017 Manufacturing Industry Outlook Report is based on theresults of our confidential web-based survey that was conductedusing SurveyMonkeycom an online survey provider
From May 2 to May 31 2017 136 manufacturing companiesresponded to our survey It consisted of 18 questions about a widerange of topics such as growth expectations challenges andopportunities direct costs and capital expenditures
We solicited feedback primarily from owners CEOs and senior-level executives of New England manufacturing companies Inaddition we received responses from two companiesheadquartered in the West and three companies headquarteredoutside of the United States Of those surveyed 50 engaged ininternational operations
Most of the respondents had between $1 million to $50 million inannual revenue But there were a significant number of very smalland very large companies involved in the survey 15 had morethan $100 million in annual revenues
SURVEY amp RESPONDENTS
ANNUAL REVENUE
Roughly 70 of respondents had100 employees or fewer Mostoperated in four locationsworldwide (or fewer)
NUMBER OF LOCATIONS WORLDWIDE
lt1001 Location
_
Respondents also varied in size More than half of our responsescame from manufacturers with $20 million or less in annualrevenues But 15 had more than $100 million in annual revenues
Roughly 70 of respondents had 100 or fewer employees
Most operated in four locations worldwide (or fewer)
Number of Locations
12-4
5+
KLR is one of New Englandrsquos premier accounting and businessadvisory firms With 225+ team members and offices in BostonNewport Providence Shanghai and Waltham KLR provides a widerange of services to both individuals and businesses
Find out why KLR is so much more than an accounting firm atKahnLitwincom
SHARE THIS REPORT
888-KLR-8557 SO MUCH MORE THANAN ACCOUNTING FIRM
LOOKING TO THE FUTURE
Responses from New Englandrsquos manufacturing trenches are primarilyupbeat despite various potential roadblocks and uncertainty aboutpossible tax reforms Many companies are making investments to setthe stage for future growth
Contact us for help planning optimal short- and long-term strategiesbased on your size sector and available resources We can also helpto identify opportunities to control your costs anticipate and tackleobstacles evaluate investment opportunities and stay up-to-date onthe latest changes to federal regulations health care coveragerequirements and tax law
ABOUT US
SHARE OUR REPORT
SURVEY amp RESPONDENTS
RESPONDENT OVERVIEW
KLRrsquos 2017 Manufacturing Industry Outlook Report is based on theresults of our confidential web-based survey that was conductedusing SurveyMonkeycom an online survey provider
From May 2 to May 31 2017 136 manufacturing companiesresponded to our survey It consisted of 18 questions about a widerange of topics such as growth expectations challenges andopportunities direct costs and capital expenditures
We solicited feedback primarily from owners CEOs and senior-level executives of New England manufacturing companies Inaddition we received responses from two companiesheadquartered in the West and three companies headquarteredoutside of the United States Of those surveyed 50 engaged ininternational operations
Most of the respondents had between $1 million to $50 million inannual revenue But there were a significant number of very smalland very large companies involved in the survey 15 had morethan $100 million in annual revenues
SURVEY amp RESPONDENTS
ANNUAL REVENUE
Roughly 70 of respondents had100 employees or fewer Mostoperated in four locationsworldwide (or fewer)
NUMBER OF LOCATIONS WORLDWIDE
lt1001 Location
_
Respondents also varied in size More than half of our responsescame from manufacturers with $20 million or less in annualrevenues But 15 had more than $100 million in annual revenues
Roughly 70 of respondents had 100 or fewer employees
Most operated in four locations worldwide (or fewer)
Number of Locations
12-4
5+
KLR is one of New Englandrsquos premier accounting and businessadvisory firms With 225+ team members and offices in BostonNewport Providence Shanghai and Waltham KLR provides a widerange of services to both individuals and businesses
Find out why KLR is so much more than an accounting firm atKahnLitwincom
SHARE THIS REPORT
888-KLR-8557 SO MUCH MORE THANAN ACCOUNTING FIRM
LOOKING TO THE FUTURE
Responses from New Englandrsquos manufacturing trenches are primarilyupbeat despite various potential roadblocks and uncertainty aboutpossible tax reforms Many companies are making investments to setthe stage for future growth
Contact us for help planning optimal short- and long-term strategiesbased on your size sector and available resources We can also helpto identify opportunities to control your costs anticipate and tackleobstacles evaluate investment opportunities and stay up-to-date onthe latest changes to federal regulations health care coveragerequirements and tax law
ABOUT US
SHARE OUR REPORT
SURVEY amp RESPONDENTS
ANNUAL REVENUE
Roughly 70 of respondents had100 employees or fewer Mostoperated in four locationsworldwide (or fewer)
NUMBER OF LOCATIONS WORLDWIDE
lt1001 Location
_
Respondents also varied in size More than half of our responsescame from manufacturers with $20 million or less in annualrevenues But 15 had more than $100 million in annual revenues
Roughly 70 of respondents had 100 or fewer employees
Most operated in four locations worldwide (or fewer)
Number of Locations
12-4
5+
KLR is one of New Englandrsquos premier accounting and businessadvisory firms With 225+ team members and offices in BostonNewport Providence Shanghai and Waltham KLR provides a widerange of services to both individuals and businesses
Find out why KLR is so much more than an accounting firm atKahnLitwincom
SHARE THIS REPORT
888-KLR-8557 SO MUCH MORE THANAN ACCOUNTING FIRM
LOOKING TO THE FUTURE
Responses from New Englandrsquos manufacturing trenches are primarilyupbeat despite various potential roadblocks and uncertainty aboutpossible tax reforms Many companies are making investments to setthe stage for future growth
Contact us for help planning optimal short- and long-term strategiesbased on your size sector and available resources We can also helpto identify opportunities to control your costs anticipate and tackleobstacles evaluate investment opportunities and stay up-to-date onthe latest changes to federal regulations health care coveragerequirements and tax law
ABOUT US
SHARE OUR REPORT
KLR is one of New Englandrsquos premier accounting and businessadvisory firms With 225+ team members and offices in BostonNewport Providence Shanghai and Waltham KLR provides a widerange of services to both individuals and businesses
Find out why KLR is so much more than an accounting firm atKahnLitwincom
SHARE THIS REPORT
888-KLR-8557 SO MUCH MORE THANAN ACCOUNTING FIRM
LOOKING TO THE FUTURE
Responses from New Englandrsquos manufacturing trenches are primarilyupbeat despite various potential roadblocks and uncertainty aboutpossible tax reforms Many companies are making investments to setthe stage for future growth
Contact us for help planning optimal short- and long-term strategiesbased on your size sector and available resources We can also helpto identify opportunities to control your costs anticipate and tackleobstacles evaluate investment opportunities and stay up-to-date onthe latest changes to federal regulations health care coveragerequirements and tax law
ABOUT US
SHARE OUR REPORT
