Reasons We Are Optimistic For Precision Manufacturing in 2012

April 17, 2012

The pundits lately are all increasingly pessimistic about manufacturing these days. Industry Week, NFIB, Bloomberg.

Please ignore the negativity in the press, we have some positive data to share.

The PMPA Business Trends Index was reported to be 125 in March, up 6 points from February.

PMPA members can access the current report here. (Accredited media can contact mfree(at)pmpa.org to receive a copy.)

Compare that to March ISM report which showed manufacturing up just 1 percentage point.

Why we are excited about prospects for manufacturing in 2012:

The correlation coefficient for our first four months of the year sales  to the end of the year average is 0.958.

If you don't know what correlation coefficient means, ask a Statistics Professor.

As the graph below shows for the years from 2003 to 2011, the blue line is the average of our Index for the first four months of each year; the red line is the Shipment Index’s year end average.

It looks like our Index's average of shipments for the year could be around 123.

Last year’s average was 113 ( 2000, 2010= 100). Our current look (three months data) could be that  precision machined products manufacturing in 2012 is up 10% from last year.

Our products are embedded as components in practically all manufactured goods- automotive, aerospace, off road, heavy truck, agriculture, food service, appliances, munitions.

Our data strongly suggests that suppliers who are fixated on fear, uncertainty, and playing defense may be doing a far greater disservice to their company’s performance this year than any external factors.

What are you doing to help assure that your company is prepared to deliver a possible 10% greater sales performance in 2012 than you did in 2011?

After all, it’s not really about our numbers.

It’s about how you manage your business.

Our  Business Trends Index numbers suggest you should be managing for growth!

Ignore the negative_pundits behind the curtain

Statistics Professor (Ben Stein)


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