Manufacturing/Distribution Articles

Manufacturers are facing uncertainty due to factors like shifting tariff policies, supply chain disruptions, fluctuating demand, and rising raw material costs. Rolling forecasts and financial modeling are two financial planning tools that can help manufacturers navigate this instability by providing continuous updates and testing various assumptions.  

This presentation by Lumsden McCormick, Boosting Cash Flow: Maximizing Federal R&D Tax Credits for Manufacturers, covered key benefits of a federal R&D tax credit, the qualified activities and expenses for federal R&D tax credits, and much more.

Group captive insurance is a strategic alternative to traditional insurance models, allowing manufacturing companies to pool their risks and stabilize costs. It offers significant benefits such as cost savings, customization, control over claims, and tax advantages, making it an attractive option for companies with strong risk management practices.

Reshoring involves bringing manufacturing operations back to the United States from abroad, driven by factors such as President Trump's tariff plans, federal and state tax incentives, and the need for supply chain stability. Manufacturers must carefully assess location selection, skilled labor availability, and equipment decisions to ensure the success of reshoring efforts.

Vendor fraud poses a significant risk to manufacturing companies, impacting their profitability and product quality. Recognizing the warning signs and implementing strict controls can help companies protect themselves from deceptive practices and maintain the integrity of their operations.

The strategies for transferring business ownership include family transfers, trusts, employee buyouts, ESOPs, and sales to outside buyers. Each option is analyzed for its tax consequences, such as gift tax, estate tax, capital gains tax, and corporate deductions, providing a comprehensive guide to succession planning.

The Trump administration's policies could significantly impact U.S. manufacturers, particularly in the areas of tariffs and trade policies, the Tax Cuts and Jobs Act (TCJA), and clean energy tax incentives. Manufacturers need to stay informed about these rapidly changing policies to navigate their impact on business.

Understanding the profitability of each product is essential for manufacturers to make strategic decisions and optimize production, marketing, and pricing strategies. By analyzing product-specific costs and profit margins, manufacturers can focus on the most profitable products and make informed financial decisions.

Manufacturers can prevent sales tax overpayments by identifying all applicable exemptions, verifying vendor charges independently, actively pursuing refunds, and maintaining vigilance. These steps help reduce sales tax liabilities, control costs, and ensure compliance with state tax regulations.

Manufacturers are increasingly integrating advanced technologies like IIoT, robotics, and automation, which makes cybersecurity more critical than ever. The convergence of IT and OT systems presents unique cybersecurity issues, and manufacturers must adopt robust cybersecurity frameworks, conduct risk assessments, and prioritize employee training to mitigate risks.