Logistics Management - June 2010

special report
2010 State of Materials Handling:
Spending gets a lift
While more companies report plans to increase investment this
year, the future looks even rosier for 2011 and 2012. Our warehouse/DC
engineer presents the highlights of the 2010 survey and
explores how the upturn is influencing current materials handling
trends and future spending plans.
By Maida Napolitano, Contributing Editor
Encouraging, strengthening, and growing: Over
the past few months that’s the way market
specialists and economists have been describing
what had been an embattled U. S. economy.
A recent report released by the Federal
Reserve shows factory production slowly but
surely climbing as sales and inventories continue
to grow.
It looks like the tide is turning, and there’s a sense of optimism
permeating the air.
The economy and its impact on material handling
equipment and technology spending
We are taking a "wait and see" approach/moving slowly with our decisions
48%
52%
We are holding off on investing
21%
20%
We are proceeding with our investments
18%
15%
Source: Modern Materials Handling/Logistics Management survey
This same positive outlook is reflected in the results of
the 2010 State of Materials Handling Survey conducted for
Logistics Management and sister publication Modern Materials
Handling by our internal research team. However, some
of that upbeat news does come with a few cautionary notes.
While there may be more companies—31 percent, up
from 28 percent in the previous survey in 2008—planning
to pull the trigger on material handling solution plans this
year, a large majority—69 percent—are still either holding
off on investing or taking a “wait and see” approach, saying
Sixty-nine percent (69%)
are holding off and taking
a “wait-and-see” approach.
Roughly one out of three companies
(31%) are moving forward with their
spending on material handling solutions.
This represents a slight improvement
since 2008 (28%).
The economy is having no/little impact on our materials handling spending
13%
13%
2010 2008
that they need to move slowly with their
decisions during the course of 2010.
However, when asked about spending
plans two to three years from now, companies
are clearly seeing a rosier future, with
58 percent of survey respondents reporting
that they plan to increase their material
handling investments—up from a low
of 47 percent in the 2008 results.
This turn-for-the-better is certainly
what everyone is seeing right now, according
to Scott Pribula, principal and market
sector leader with TranSystems, a consulting
firm specializing in transportation
and supply chain services. “People are a
lot more optimistic, and we’ve seen a lot
more activity at the beginning of this year
than we did the whole of last year.”
Conducted in February 2010, our survey
aims to better understand the current
state, trends, and practices in manufacturing,
warehousing, and distribution
environments while tracking changes in
the material handling market over the
24 Logistics Management WWW.LOGISTICSMGMT.COM | June 2010