During the week of April 27^th, Gardner Intelligence conducted a survey to understand how manufacturers are responding and will respond in the future to the effects of COVID-19 now that states are starting to open their economies. The survey focuses on two basic questions:

1. What actions is your company considering taking?
2. What is the priority of the actions your company is considering taking?

Manufacturers already began taking four critical actions to ensure their businesses could remain operational:

1. Reorganize workflow to allow for social distancing – 80%
2. Supply (more) PPE for employees – 78%
3. Revisit budgets and forecasts – 76%
4. Establish shop as an essential business – 72%

 

Manufacturers already began taking four critical actions to ensure their businesses could remain operational: 1) Reorganize workflow to allow for social distancing, 2) Supply (more) PPE for employees, 3) Revisit budgets and forecasts, and 4) Establish shop as an essential business.

After taking these critical sustaining actions, manufacturers will shift their focus in the next six months to preparing for or generating an increase in business. Even though some manufacturers have already begun these actions, at least 20% of manufacturers plan to take these actions in the next six months and at least an additional 7% of manufacturers plan to take these actions after 6 months:

1. Invest in business facilities – 27%, 15% (next six months, over six months)
2. Prepare for surge in orders – 24%, 7%
3. Increase/upgrade marketing – 23%, 12%
4. Re-examine insurance coverage for the impact of events like COVID-19 – 22%, 12%

After taking action to meet their immediate needs, manufacturers will be able to focus on longer-term actions during the next six months.

In terms of priority, of the top four actions that manufacturers already began, two were in the top five priorities, measured by the percent of manufacturers that stated the action was somewhat high or very high priority: supply (more) PPE for employees (63%) and establish shop as an essential business (60%). Also, these two actions were number one and two in terms of very high priority. Again, the immediate focus for manufacturers was on keeping the business running, both in terms of employee health and state law.

The immediate top priorities of manufacturers were employee health and keeping the business open. Top priorities quickly shifted to making up lost revenue and building a cash reserve. The next set of priorities will be investing in the business to expand product offerings and/or prepare for a surge in orders.

Immediately after sustaining the business, the priority was revenue and cash flow. Based on the combined percent of somewhat high priority and very high priority, the top two priorities were: 

1. Develop plans to make up revenue lost due to COVID-19 – 70%
2. Increase cash reserve – 64%

Taking into account all respondents who indicated at least a moderate priority to taking an action, the top five priorities are:

1. Develop plans to make up revenue lost due to COVID-19 – 90%
2. Increase cash reserve – 90%
3. Invest in business/facilities – 90%
4. Expand product mix – 89%
5. Prepare for a surge in orders due to business closing and pent up demand – 87%

So, for manufacturers, the most immediate actions with the highest priority were protecting the health of employees and keeping the business legally open. Very quickly, the priorities shifted to making up for lost revenue and building a cash reserve. Once their financial position is solidified, within the next six months, manufacturers are looking to invest in technology to expand their product offerings and/or handle a surge in orders.