Printer Friendly

AMERICA'S FASTEST GROWING PRODUCT COMPANIES EXPECT TO ACHIEVE COMEBACK IN 1993, WHILE SERVICE FIRM GROWTH FLATTENS: COOPERS & LYBRAND SURVEY

 NEW YORK, Feb. 17 /PRNewswire/ -- CEOs of America's fastest growing product companies expect their firms to rebound from last year's downturn and to grow significantly in 1993, according to Coopers & Lybrand's latest "Trendsetter Barometer" survey. Product companies surveyed predict their growth will catch up to the generally higher growth levels of service firms this year. Service companies surveyed forecast a flattening of growth at 1992 levels.
 Driven by renewed optimism in the U.S. economy and their own prospects, these product company CEOs say they will achieve growth increases of 24.2 percent in 1993, almost matching the 25.5 percent growth rate predicted by their service firm counterparts.
 Additional positive signs for the fast-growing product sector include plans for increased capital spending, bank loans and financing, and projections for hiring more employees in 1993, according to the survey. Both product and service sector CEOs surveyed also indicate plans for expanded investment in many areas of their businesses.
 "Trendsetter Barometer" reveals that 52 percent of product companies anticipate new growth investments at the rate of 12.6 percent of revenues this year, compared to 50 percent of service companies planning to invest only at a 10.7 percent rate of revenues.
 "Growth companies are stressing increased investments in many areas, from new products to sales promotion to information technology," George Auxier, national director of Coopers & Lybrand's Emerging Business Services group, said today.
 Yet the outlets for investment differ somewhat, according to the survey, with product firms directing more money into product development, research & development, and facilities expansion. Service firms plan greater investments than product firms in information technology and geographic expansion, according to the survey.
 Product Firms Plan Ahead for Robust New Year
 Most product firms have anticipated new growth since the fourth quarter of 1992, the survey finds, by increasing capital spending, bank loans and financing. Service firms, on the other hand, have taken a conservative approach since mid-1992, evidenced by their lower borrowing and spending levels.
 In the fourth quarter of 1992, 33 percent of product firms completed bank loans or financing, compared to only 25 percent of service firms, according to the survey. And 18 percent of product firms surveyed obtained longer credit terms, versus only 11 percent of service firms during the same period.
 Interestingly, only 7 percent of the product companies that applied for loans during the fourth quarter were "turned down," while 16 percent of service firms applying were denied bank loans, the survey finds.
 While credit availability increased overall in the fourth quarter of 1992, 31 percent of product companies surveyed increased their credit compared to 24 percent of service firms. According to the survey, the growth of credit for product firms was also greater, averaging 14.8 percent versus only 6.4 percent for service firms.
 Overall, bank interest rates to growth companies have dropped 20 percent over the past year, from 9.21 percent to 7.36 percent at 1992 year end.
 "Recently, product firms have obtained significantly more bank loans, yet they are paying slightly higher interest rates at 7.39 percent than service firms at 7.30 percent," explained Auxier. "This is a reversal of the situation last year in which product firms paid an average of 9.13 percent interest compared to 9.31 percent for service firms."
 Hiring Spurred by Growth Plans
 Although product firms still lag service companies in plans for new hires, they are beginning to close the gap, the survey finds. Seventy- four percent of product firms surveyed plan to add employ ?in 1993 compared to 82 percent of service firms saying they will hire staff this year.
 "These figures are good news for the product sector when compared to a year ago -- only 67 percent of product firms, compared with 80 percent of service firms, said they planned to hire employees," said Auxier.
 Coopers & Lybrand's "Trendsetter Barometer" is developed and compiled by the firm's Emerging Business Services group with assistance from the opinion and economic research firm of Business Science International. At each Coopers & Lybrand office, an Emerging Business Services team is available to serve the needs of small and midsize companies.
 One of the world's leading professional firms, Coopers & Lybrand provides services to enterprises in a wide range of industries. The firm offers its clients the expertise of more than 16,000 professionals and staff in offices located in 101 U.S. cities and more than 66,000 people in 120 countries worldwide.
 -0- 2/17/93
 /NOTE TO EDITORS: Coopers & Lybrand's "Trendsetter Barometer" interviewed CEOs of 300 product and service companies identified in the media as the fastest growing U.S. businesses over the last five years. The surveyed companies range in size from approximately $1 million to $50 million in revenue/sales.
 Graphic art available upon request/
 /CONTACT: Clare DeNicola of Coopers & Lybrand, 212-536-1700/


CO: Coopers & Lybrand ST: New York IN: FIN SU: ECO

GK-LR -- NY024 -- 7210 02/17/93 10:20 EST
COPYRIGHT 1993 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1993 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Feb 17, 1993
Words:823
Previous Article:OSTEOTECH'S POLYACTIVE POLYMER PRESENTED AT INTERNATIONAL BIOMATERIALS MEETING
Next Article:WORKSHOP ON CABLE TELEVISION FOR NON-PROFIT AND CULTURAL GROUPS
Topics:


Related Articles
GROWTH COMPANIES' CONTINUED CONFIDENCE IN ECONOMY TEMPERED BY DECREASED NEAR-TERM GROWTH ESTIMATES FOR THEMSELVES: COOPERS & LYBRAND SURVEY
Survey: cautious CEOs hold back on growth.
GROWTH COMPANIES LOSE FAITH IN U.S. ECONOMY OVER NEXT 12 MONTHS, COOPERS & LYBRAND 'TRENDSETTER BAROMETER' FINDS
FAST-GROWTH COMPANY CEOs' RESURGENT OPTIMISM TOWARD ECONOMY MARKS ADVENT OF CLINTON PRESIDENCY
MOST FAST-GROWTH CEOS TURN NEGATIVE ON CLINTON ECONOMIC PROGRAM ACCORDING TO COOPERS & LYBRAND'S 'TRENDSETTER BAROMETER'
STRATEGIC ALLIANCE ACT AS CATALYST FOR GROWTH COMPANIES, FUELING THEIR RISE, 'TRENDSETTER BAROMETER' SURVEY FINDS
COOPERS & LYBRAND: FAST GROWTH COMPANIES EXPERIENCING UPWARD SURGE IN BANK LOANS AND CREDIT AVAILABILITY, 'TRENDSETTER BAROMETER' CEOS REPORT
GROWTH COMPANIES REPORT SHARP INCREASE IN DEBT RESTRUCTURING, COOPERS & LYBRAND 'TRENDSETTER BAROMETER' SURVEY FINDS
CLINTON HEALTH CARE PLAN WILL PROVIDE MORE SECURITY FOR EMPLOYEES, ADD TO COMPANIES' ADMINISTRATIVE COSTS, 'TRENDSETTER BAROMETER' SURVEY SHOWS
COOPERS & LYBRAND 'TRENDSETTER BAROMETER' SURVEY FINDS MANY GROWTH COMPANIES INADEQUATELY PREPARED TO GO PUBLIC

Terms of use | Copyright © 2016 Farlex, Inc. | Feedback | For webmasters