How do you keep track of the economy’s ups and downs as it relates to your specific category or industry?
Todays post is by Ronald D. Southard, CEO at SafeSourcing Inc.
There certainly are business trends that can provide somewhat of a prediction, but is there any way to keep a measure on the pulse of how the economy is affecting you on a more regular basis?
A Purchasing Managers’ Index (PMI) is a great way to keep track of market fluctuations. The PMI measures activity such as production, new orders, inventories, and employment levels. The PMI is compiled by the Markit Group and the Institute for Supply Management and is calculated on a monthly basis by polling businesses that represent the make-up of the private sector. According to Wikipedia, “the manufacturing data is generally released on the 1st working day of the month, followed by construction on the 2nd working day and services on the 3rd working day.”
The data for the index are collected through a survey of over 400 purchasing managers in the manufacturing sector on five different fields. Each respondent has the opportunity to report on levels of better, same, or worse than previous months. Depending on the manufacturing region, there may be a specific survey of results for the region as well as the specific manufacturing sector.
As an example, a US national PMI would be issued in the first few days of February and might report that nine out of eighteen manufacturing industries were reporting growth in January. So if you wanted to keep a better pulse on the economy of your industry, the PMI survey is a great place to start and is updated monthly.
In addition to our own internal data, SafeSourcing tracks how multiple industries are doing on a regular basis, please contact a Customer Service Representative for more information.
We look forward to and appreciate your comments.