American companies that don't invest in new technologies face a growing threat from international manufacturers that have their eye on expanding stateside, according to Karen Kurek, a partner with the CPA firm McGladrey LLP, in Global Companies Pose Threat in U.S.
U.S. distributors and manufacturers might not sense any looming rise in global competition because of the strengthening economy here, but the rosier climate is enticing to international manufacturers, many of whom have made greater technological advancements than their American counterparts.
Globally, executives expect average sales to increase 12 percent over the next 12 months, and they also plan to increase domestic hiring by roughly 8 percent, according to McGladrey's 2015 Manufacturing & Distribution Monitor Report.
But as the economy improves, more than half of the non-U.S. manufacturers that intend to sell products or services outside their home markets in 2015 plan to expand in the U.S. This newfound interest in establishing a U.S. presence doesn't bode well for American companies that delayed investing in new technologies over recent years as the nation slowly climbed out of the Great Recession.
“After 2009, which was obviously the big recession and economic downturn, there were a lot of U.S. manufacturers that put off updating and investing in their IT systems,” Kurek says. “They were basically making sure the lights stayed on and they were navigating what was happening in the economy at that time.”
Even now, instead of proactively investing in technology to stay ahead of the competition, many U.S. companies instead “look to invest dollars to fix problems as more of a reaction to things that happen,” Kurek says.
Read more about why that attitude needs to change in Global Companies Pose Threat in U.S.