One in two Australian manufacturers responding to the survey (55%) intend to reshore their operations to Australia by 2023 following market volatility caused by the COVID-19 pandemic and international relations with neighbouring countries, according to the new PROS survey.
The Australian Manufacturing Outlook survey revealed "confidence in that the Australian economy is growing, with more companies signalling they intend to bring manufacturing operations back to Australia. Nearly one quarter (22%) of respondents have already reshored their operations, with nearly half of companies’ overall manufacturing capacity (48%) targeted to return to Australia by 2023.
"Western Australia, Northern Territory and South Australia are poised to lead the nation’s charge on reshoring over the next three years according to respondents, with a focus on creating local jobs and growing priority sectors such as lithium batteries, defence and space, and capitalising on their respective geographic advantages."
"The rise to reshore has been driven by the need to future-proof critical supply chains in the face of market change and disruption, to minimise risk and protect jobs in key industries. This is coupled with the Australian Government’s support through the Modern Manufacturing five-year plan and strong consumer preference (89%) towards our nation producing more products, according to research conducted by Roy Morgan.
"Three-quarters of those surveyed (78%) believe Australia possesses the technology, people and economic strength to support the creation of an agile manufacturing base, which would better protect and reinstate the local production of goods. Recent quarterly GDP data (released in December) also revealed a growth of 3.1%, as Australia pushed through the height of the pandemic.
"However, Australian manufacturers are underprepared to compete in a digital economy, with 82% of survey respondents still in the planning process or yet to implement eCommerce channels to sell to domestic or international buyers; only nine% also have market-aware, dynamic pricing strategies."
Haley Glasgow, APAC Head of Strategic Consulting and Alliances at PROS said: “The economic recovery is well underway, but Australian manufacturers must equip themselves with eCommerce and dynamic pricing capabilities, otherwise we risk not only stalling the economic growth already achieved but missing the right moment in history to reclaim our manufacturing heritage.
“Australia is incredibly well-placed to leverage smart technologies like artificial intelligence and digital selling channels to overcome the competition challenges from imports and online sources. But to reinvent themselves, investment must be made by the government, industry and companies themselves.
“Accelerating the sales process with AI-powered insights can also deliver prescriptive guidance on product recommendations, identify cross-sell and up-sell opportunities and proactively mitigate churn risk. This investment can improve the buying experience, order accuracy and accelerate business growth as the economy recovers,” Glasgow continued.
In support of strengthening self-reliance, we're told "nine in ten (90%) Australian manufacturer respondents are confident their company has access to a skilled Australian workforce capable of producing, marketing and selling its products through traditional and digital channels.
"Prior to the pandemic, multinational glass manufacturer Saint-Gobain had a traditional approach to purchasing and selling, completing only 10% of its orders online. Now, more than 80% of orders are conducted through AI-powered digital selling platforms, demonstrating the growing appetite from manufacturing buyers to purchase through digital channels."
Jean Phillippe Bitouzet, Supply Chain and Business Model Director at Saint-Gobain said: In the emerging digital selling landscape, customers are looking for a frictionless buying experiences, with immediate responses about pricing and delivery.
“PROS has proved to be an excellent partner, committed to our success. Today we’re able to simplify the order process, deliver quotes more quickly, and provide tracking and delivery.”
“As Australian manufacturers seek to reshore, it is vital they lead with a digital strategy and mindset if they are to achieve local and global competitiveness. Leveraging price optimisation solutions to process billions of unique prices in real-time, while catering to the complexity of each buying interaction, creates a harmonised pricing strategy for 2021 and beyond,” Glasgow concluded.
The Australian Manufacturing Outlook survey was conducted by independent market research firm OnePoll in December 2020. The research sample consisted of 500 senior employees in the manufacturing sector across Australia.
Here's a couple of manufacturing related videos from the official PROS YouTube channel: