Manufacturers around the world are facing significant challenges and opportunities amid a volatile geopolitical climate and the threat of a looming trade war. Nearly a quarter of companies import more than half of their components, and almost a third spend $1 million or more on custom duties and tariffs, making them vulnerable to trade policy shifts, geopolitical risks, and logistics bottlenecks. While many companies recognize supply chain risks and the need for operational improvements, most are slow to act and take proactive measures.

These are among the findings from the second annual U.S. National Manufacturing & Distribution Study from Aprio, the 24^th largest business advisory and accounting firm in the U.S. The study is designed to help manufacturers benchmark the effectiveness of their operations as they drive efficiency and growth. 

"Manufacturers and distributors are grappling with unprecedented challenges, yet the latest iteration of Aprio's U.S. National Manufacturing & Distribution Study reveals significant opportunities to automate processes and adopt supply chain best practices," said Adam Beckerman, Manufacturing and Distribution Leader at Aprio. "These improvements can drive more efficient reporting and production – ultimately enabling growth and positioning businesses to win in a complex global trade environment."

This year's study, which gathered responses from executives at companies with headquarters in 34 states, representing more than 20 industries, finds that many industrial companies continue to face challenges and have substantial opportunities for improvement across critical functions. Some of these critical findings include:

• Supply Chain: Most companies continue to experience supplier problems, especially product delays and product defects. Yet more than half of companies don't assess many supplier criteria. The top criteria assessed are quality/reliability (just 48% of companies), total cost (46%), and productivity (42%). Moreover, supply chain best practices are ignored, with only 36% of companies sharing forecasts with primary suppliers.

• Information Technology: Nearly half (48%) of companies experienced at least one breach of networks and data in the past year, and 17% report five or more breaches. Yet, many best practices to improve cybersecurity are ignored by high percentages of companies. Even the most-used approaches are deployed at only half of companies, like cybersecurity training (52% of companies), cybersecurity policy (50%), and cybersecurity audits (46%).

• Workforce Management: Many companies continue to face annual labor turnover rates of more than 10% for frontline employees (42% of companies), managers and supervisors (30%), and senior executives/leadership (28%).

• Operations: Nearly two-thirds (66%) of companies empower half or fewer of frontline employees to solve problems, and 67% of companies report that half or fewer of their frontline employees are multi-skilled.

To learn more about the findings of the report, visit aprio.com.