Our fourth and final installment about our new report —Forging New Partnerships–i s about how companies can effectively pay for their expansions and worker training programs. As our report notes:
Doing business in the global value chain increases the level of complexity in all aspects of the company, including financing. The environment for securing capital to finance operations and growth is no longer as easy as filling out a loan application or placing a call to your neighborhood banker. Small and medium manufacturers (SMMs) should look to a wider range of financing sources to grow.
Our partner for this report was RSM McGladrey, a global accounting, tax and business consulting firm headquartered in Minnesota. A survey they conducted among their manufacturing clients last year showed that one of the leading barriers to pursuing international growth is the inability to obtain suitable financing. As the global value chain expands, this need will only intensify. The same survey showed that the top three reasons for not participating in government programs that can assist SMMs with financing are:
294 companies were unfamiliar with the government financing programs; 196 were not interested in them and 187 were unsure how to get started.
One of the reasons for writing Forging New Partnerships is to better educate SMMs about some of the financing options open to them. It also profiles three companies that have found ways to utilize some of these resources.
Bison Gear & Engineering in Illinois has used industrial revenue bonds to build a new plant and tapped a Small Business Innovation Research (SBIR) grant from the National Science Foundation to conduct research on new motor technology. Pacific Plastics in California harnessed state grants for worker training and has applied for a federal Trade Adjustment Assistance grant that is being piloted in the innovation corridor in California. Al-jon in Iowa turned to investment partners to grow his business, not only with cash, but also with the know-how of applying it wisely to lean manufacturing and redesign of its service delivery.
This wraps up our blog discussion of how manufacturers are dealing with new challenges in the value chain. We always welcome comments and questions and, if you’d like to read Forging New Partnerships, it’s available for free on our website. Just click the link above and it will take you to it.
Latest posts by Carter Wood (see all)
- Farewell from a Blogger - May 25, 2011
- Activist Ignore Evidence to Back Shakedown Suit Against Chevron - May 25, 2011
- More than a Lawsuit: A Circle of Political Pressure Against Chevron - May 25, 2011