Research - 19.07.2017 - 00:00
20 July 2017. Researchers of the Institute of Technology Management (ITEM-HSG) at the University of St.Gallen, with the help of Raiffeisen and Swissmem, evaluated data of 247 firms from 14 industries ranging from machine-building to textiles. The report reflects the latest developments in Switzerland’s manufacturing companies. The long-term survey enables researchers to map the structural change and its impact on Switzerland. “With our report, we want to provide companies, associations, politicians and academics with information about trends, opportunities and obstacles in order to strengthen Switzerland’s productive industry,” says Prof. Dr. Thomas Friedli, one of the authors of the study and production management expert at the ITEM-HSG.
Quality and reliable delivery are in demand
Approx. 80 per cent of the firms interviewed for the 2017 Swiss Manufacturing Survey are small and medium-sized enterprises (SMEs) with fewer than 250 employees. 44 per cent of all firms interviewed operate at an international level. They sell their products mainly in Switzerland and Western Europe. As the survey reveals, a majority of customers regard geographical proximity as unimportant. Thus there is potential to access new markets. According to the survey, the export share in the interviewees’ turnover exceeds 60 per cent; in large companies, it is even more than three quarters. The report shows that customers particularly appreciate Swiss companies’ quality and reliable delivery, while the “Made in Switzerland” brand tends to be a secondary purchasing criterion, which makes it easier for firms to make outsourcing decisions.
To cut the costs, 46 per cent of the firms interviewed are considering outsourcing part of their manufacturing operations to China, Germany or Eastern Europe. According to the companies, the main obstacles for production in Switzerland are the unfavourable rate of exchange and high labour costs: on average, Swiss manufacturing plants cost 37 per cent more than foreign ones, with a bandwidth ranging from 20 per cent higher costs in large companies and 43 per cent in SMEs. The Swiss sites usually retain their leading roles in engineering and in the establishment and transfer of important knowledge to other plants.
Above-average innovation capacity
According to the study, the innovation capacity of Swiss operations can also be gleaned from the average research and development ratio (R&D), which at more than 9 per cent is above the global value. More and more products which are developed in Switzerland are produced abroad, however. Yet Switzerland still possesses a broad production basis, and products from Switzerland are still regarded as superior to their foreign competitors’ in terms of quality, reliable delivery and innovation.
Today, more than half of all the jobs in Swiss manufacturing companies are located in production and assembly. The authors of the study assume that this proportion will decrease in the future. Conversely, the proportion of R&D and servicing personnel will increase in the Swiss location and aggravate the already challenging search for qualified employees even more. The next Swiss Manufacturing Survey will start in autumn 2017.
Bild: jarts / www.photocase.com
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