Manufacturers cannot escape the changes from globalization. But there are ways manufacturers can compete. Where there’s change there are always new opportunities. Many manufacturers are flourishing today due to some key factors:

1. NEW AND GROWING INDUSTRIES
   
   Advanced Manufacturing—Some industries will be replaced by new and emerging high growth industries. They are high technology such as biomedical devices, nonotechnology, nanomanufacturing, informatics, biotechnology, pervasive computing, analytical instrumentation, and opto-electronics. Some of these industries can become high growth. This technology also can be used in other industries and manufacturing.
   
   Traditional—Some huge traditional industries have a long history of growth. Although not spectacular, their growth is sustained and they’ll continue to change to be more competitive. The chemical industry includes hundreds, if not thousands, of market segments supplied by manufacturers of all sizes. With changes in each and ongoing growth, there will be thousands of opportunities for new products and services, particularly process/production automation.
   
   Another example is the packaging industry. Whenever a consumer products manufacturer changes packaging it causes a chain reaction of opportunities down through the suppliers providing machines for their production lines. Saving money by eliminating traditional cardboard and replacing it with shrinkwrap or plastic will cause every machine in the line to change. Every major industry has thousands of packaging changes making thousands of opportunities for new machine applications or designs.
   
   Where there’s rapid growth or massive change in industries and customers, thousands of new market niches and hundreds of thousands of new applications will emerge. U.S. manufacturers are geographically closest to these industries and can seize the initiative to find the best solutions. It’s all about staying close to customers and their problems.
    
2. MARKET NICHES AND NEW CUSTOMERS
   
   The most important strategy is developing methods to continually look for new customers and market opportunities.
   
   Small and midsize manufacturers of industrial goods have gotten by for years depending on a handful (less than 20%) of customers for 80% of their business. Unfortunately many of these customers (a.k.a. Most Valuable Customers or MVC’s) are now finding foreign suppliers or driving prices down so much that they’re no longer valuable. Manufacturers must become industrial marketers and develop systems to continuously seek new customers and markets. They will have to both monitor customers and pursue market opportunities.
   
   Most industrial manufacturers are operations-driven not market-driven. If they learn to change from an internal to external focus, change their sales and distribution systems, and understand the basis of niche marketing and lead generation, they can benefit from new customer and market opportunities. This old mindset is the biggest obstacle manufacturers must overcome to truly compete.
   
   Columbia Okura, manufacturer of material handling robots, found a small niche handling bags of calcium carbonate in the chemical industry. This application led to ten more bag applications in different industries and turned the company around in a year.
                                                                 
3. CHANGING YOUR SALES AND DISTRIBUTION
   
   As customers change to compete, their needs change drastically. They are being pushed for new products, lower prices, and more services. They in turn push suppliers for new products, lower prices, and more services. These changes will automatically force manufacturers to rethink their sales and distribution channel strategies. In fact, the current revolution in manufacturing is causing great changes to distribution channels.
   
   Progressive manufacturers are changing their channels to fit the new mix of customers and their new needs. Much experimentation is required. They use a variety of alternatives to serve niches. Alternatives include major account sales, direct factory sales, outside representatives, distributors, telemarketing, catalogs, and combinations of each. By using the right mix to fit the most customers, the chances of selling to a wide variety of niches are greatly enhanced.
                                          
4. INNOVATIVE NEW PRODUCTS
   
   Innovation and new product development have been the strength of U.S. manufacturers and will become more important in the future to gain competitive advantage. The challenge is to develop new products that are not easily copied.
   
   Here are five ways that American manufacturers can retain the edge in new product development:
   
   Customization—There is a growing requirement for products that are customized to a specific application or unique specifications. This used to be considered bad. Today, customization is a weapon favoring U.S. manufacturers.
   
   Collaboration—Collaborating with customers in new product development is another advantage of local manufacturers and can build strong relationships and repeat business.
   
   Adapting new technologies—For small and midsize U.S. manufacturers, there are endless opportunities to develop new products and serve specific needs by using technology developed by large companies. For example, by adopting the latest programmable controllers, industrial computers, servo drives, and composite materials, packaging machinery makers can always upgrade or develop new machines.
   
   Adopting time to market techniques—Shortening the time to market from the birth of an idea, especially a customer’s idea, is critical. There are various techniques to streamline the process giving local manufacturers the advantage.
   
   Commercialization—Studies show only one of seven new ideas is successfully commercialized. Most causes of this involve the upfront work ensuring an idea is competitive, has potential customers, and is unique. American manufacturers can increase their competitiveness in new products by improving the success ratio of new product ideas. 70% of the information needed to do this comes from the market, not technical areas. Again, American manufacturers have the advantage. It’s difficult and expensive for foreign manufacturers to gather market data when they’re an ocean away.

Micheal Collins, founder of MPC Management, wrote The Manufacturer’s Guide to Business Marketing, the first guide to industrial marketing for small manufacturers.