Innovation Is Key for Manufacturing Companies

Manufacturing companies are focusing on innovation and R&D investment to stay competitive in the market.

According to the 2015 KPMG Global Manufacturing Outlook (GMO) Survey , more than 2/3 of the 386 manufacturing executives surveyed state that long-term innovation strategies, with an intention for increased investment in R&D and new manufacturing technologies, are their top priority.

“Investing more in R&D is certainly helpful, but manufacturers need to also focus on continuously enhancing and adapting their innovation models if they hope to survive,” says Jeff Dobbs, KPMG’s Global Head of Industrial Manufacturing, according to Global Trade Daily.

44% of those surveyed said they will spend more than 20% of their technology budget on systems to enhance the “pace and value of innovation — engineering, manufacturing and supply chain — ” within the next year.

“The focus on new product development, collaborative innovation and speed-to-market all require new strategies and business models. If manufacturers hope to grow by driving new innovations to market, they need to focus on improving the agility and integration of their supply chain models,” said Dobbs.

Many manufacturing companies rely on the R&D Tax Credit to be able to innovate and excel in the industry. Out of the $10.8 billion in research credits that were granted in 2012, $6.6 billion were reported by corporations in the manufacturing business.

By identifying and documenting qualifying research activities and expenditures, manufacturing corporations, along with essentially any other industry, can optimize their R&D tax credits and reduce tax liability.

Click here to find out if your company is eligible for the federal R&D Tax Credit.

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