New findings from Aprio’s 2025 U.S. National Manufacturing & Distribution Study uncover a troubling trend in the manufacturing sector where critical areas such as supplier performance, cybersecurity, and workforce agility are frequently overlooked. These findings underscore the potential for missed opportunities which could exacerbate existing vulnerabilities within procurement, logistics, and operational continuity.
The study reveals that while nearly one in four manufacturers sources over half of their components internationally, many lack robust frameworks for supplier evaluation. A mere 48% of firms actively assess supplier quality and reliability, and even fewer monitor cost and productivity metrics. This lack of comprehensive oversight around supplier performance is particularly concerning in light of tariff pressures. One-third of surveyed companies reported expenditures exceeding $1 million annually on duties and customs fees. In an era marked by shifting U.S. trade policies and potential trade wars, the failure to effectively evaluate suppliers may hinder organisations’ ability to adapt swiftly.
Moreover, persistent supply chain challenges continue to plague manufacturers, with many respondents indicating ongoing delays and quality issues. Without implementing strong supplier scorecards or predictive analytics, companies find themselves in a reactive position instead of proactively managing risks. For leaders in supply chain management, tightening evaluative standards and embedding risk indicators into procurement workflows is now essential, no longer merely an option.
Parallel to supplier oversight, the study highlights significant weaknesses in workforce management and cybersecurity — two areas critical to maintaining operational resilience. Labour turnover rates remain concerning, particularly among frontline workers, with 42% of firms reporting annual churn exceeding 10%. However, only 67% of companies claim that even half of their frontline teams are cross-trained, signalling a definite shortfall in operational flexibility across the sector.
Cybersecurity poses an equally daunting challenge. Nearly half of the surveyed manufacturers reported experiencing at least one IT breach in the previous year, with 17% indicating multiple breaches. Despite the prevalence of these incidents, foundational cybersecurity measures, such as staff training and robust policy development, have reached only about half of the organisations surveyed. This gap leaves both internal systems and broader digital supply networks vulnerable to increasingly sophisticated cyber threats.
Compounding these issues, many companies fail to empower frontline teams as problem-solvers. Two-thirds of respondents noted that only half or less of their frontline staff are given the autonomy to tackle issues independently. In fast-paced production and logistics environments, this lack of empowerment can significantly slow down problem resolution and lead to mounting inefficiencies.
The overarching theme of the Aprio study suggests that the efficiency gaps observed in manufacturing and distribution are less about unfamiliarity with these issues and more about a fundamental lack of operational governance. Achieving truly resilient supply chains calls for a reevaluation of how suppliers, workforce development, and cybersecurity are viewed—these elements should not be siloed but considered collectively for enterprise continuity.
Elevating supplier performance management, enhancing the role of frontline problem-solving, and reinforcing digital infrastructure are critical steps for navigating future trade and labour market fluctuations. This holistic approach can help manufacturers withstand challenges and seize opportunities amid an increasingly complex global landscape.
As companies embrace the advent of smart manufacturing technologies, the necessity for focused investments becomes evident. While the potential of these technologies—such as automation, AI, and the Industrial Internet of Things (IIoT)—is widely recognised, significant hurdles remain. Many organisations report resistance to change and concerns over high upfront costs as barriers to implementation. Addressing these challenges is vital to ensuring that manufacturers optimise operational efficiency as they transition into a digitally integrated future.
In a landscape where 92% of manufacturers believe that smart manufacturing will enhance competitiveness in the coming years, those who prioritise systemic improvements in supplier evaluation, workforce management, and cybersecurity stand to gain the most. These enhancements are not just incremental but foundational for driving growth and innovation in the face of a rapidly evolving market.
Reference Map
- Leads the overview of Aprio’s findings.
- Reinforces the need for enhanced supplier evaluation.
- Discusses smart manufacturing outcomes and challenges.
- Covers cybersecurity vulnerabilities and neglect of best practices.
- Highlights eagerness for smart technologies alongside deployment challenges.
- Reiterates safety and operational inefficiencies.
- Describes transformative impacts of automation and AI in manufacturing.
Source: Noah Wire Services
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