Spending Gets a Boost

Chart comparing the 1991 and 1992 investment plans of growth companies.

By Bruce G. Posner | 
 

For many growth companies, the economic recovery is more than a mirage. In a late-1992 survey of 300 growth companies (with revenues of $1 million to $50 million) by Coopers & Lybrand, CEOs reported sizable increases in their investment plans. On average, companies planned to invest 11.8% of their revenues, up from 10.5% in 1991. (The intended source of the capital: both internal funds and money from outside sources.) Manufacturers planned far bigger increases than service firms did. The survey asked CEOs what they intended to boost spending on in the coming year.

Percent of respondents

1991 1992

Sales promotion 31% 45%

New-product development 35 44

Information technology 27 43

Geographic expansion 32 37

Facility expansion 31 34

Research and development 27 33

Acquisitions 14 23

Source: "Coopers & Lybrand Trendsetter Barometer," New York City, 1992.

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