Industrial Survey Reveals Internet’s Importance to Manufacturers

For many industries, the Internet is the obvious place to go to expand their business. It’s not uncommon to see local mom and pop stores that also have an online side of things that allows them to sell to people around the country and world. However, one sector that has, for a long time, had a hard time evolving and moving to the Internet is the industrial world.

Embracing the ‘Net

What has become apparent, though, is that these same small business owners that, for so long, were unable to use the Internet for growth are starting to realize that there is a great capability for them to generate revenue utilizing the Internet. And in many cases, they generate more revenue than if they had simply stayed separate from the Internet.

In July, ThomasNet released their semi-annual Industry Market Barometer (IMB). This barometer is a survey conducted with over 3,700 North American buyers and sellers of industrial products. The majority of those surveyed are from companies that have fewer than 100 employees and $10 million annually in revenue or less.

Outperforming

A term used in the IMB, important to the validity of the survey, was the “outperformers.” These were people who had seen growth in the previous half of the year and had expected more growth in this half of the year. These “outperformers” were the most optimistic about business and also saw the most success.

According to the IMB, three quarters of those that were surveyed said that their website resulted in new growth for their business from July to December 2010. However, more importantly were the 42% of “outperformers” who admitted that they saw new revenue appear from having a website.

To be specific, 35% of manufacturers and 40% of custom manufacturers saw that new revenue growth grew due to their website. On top of that, almost half of manufacturers and 60% of custom manufacturers surveyed found that it allowed them to open new sources of business.

One of the big issues that many industrial businesses have been witnessing is client retention. With the economy the way it is, many of their buyers are going out of business which results in a domino effect. Because of that, many businesses are focusing on bringing employees on who can help keep clients around.

Customer Focused

With that in mind, quite a few of those surveyed found that their website helped serve customers more effectively. 52% of manufacturers and just over a third of custom manufacturers saw that they were better able to serve the needs of their customers.

Not All Rosy

The downside to all of this is that, while they have websites, they are still severely lacking. When presented with the question, “Which of the following challenges do you encounter when specifying, sourcing or buying online for your company,” there were a lot of problems. Primarily, 42% of buying departments felt that there was not enough detailed product information. 47% said that there was a lack of comparison features so that they could determine which the better pick was for them.

Despite many of these sites attempting to run an e-commerce type of website, 35% of buyers said that the lack of pricing was a big challenge for them. By not being able to compare the different products and prices of them, buyers were turned off to the idea of utilizing the Internet.

Should these industrial small business owners build websites that deal with these challenges to buyers, there is a firm belief that more business would be generated for them. It would allow buyers the ease to research which product they need and further allow them to make purchases easily.

With the Internet growing faster every day, it is important for industrial businesses to make that push online so that they can reach new businesses and keep their current business.

About the Author: Jacob Donnelly is an employee of ThomasNet, a directory that brings buyers and sellers of industrial products and services together.

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