While transaction professionals continue to forecast growth in manufacturing deals, their expectations have been dimming over the last two years, according to Mergers & Acquisitions’ Mid-Market Pulse (MMP).

In our most recent poll, the sector received a 3-month outlook score of 59.1, lower than the 64.8 score given to overall M&A for the same time period. The 12-month outlook was even lower, at 57.9 for manufacturing, compared with 61.1 for overall M&A.The numbers have been declining since early 2014, when survey respondents gave manufacturing a 3-month score of 80.6 and a 12-month score of 81.8.

Respondents cited several challenges facing manufacturers today, including the need to build scale, keep up with innovation, and diversify geographic footprints in an increasingly competitive environment. Some participants expressed the hope that manufacturers would invest in more technology.

October manufacturing deals have come from Investcorp, which bought sportswear manufacturer Poc Sweden AB; and Olympus Partners, which acquired packaging equipment maker Liquid-Box Holdings Inc. 

The MMP is a forward-looking sentiment indicator, derived from monthly surveys of approximately 250 executives and published in partnership with McGladrey LLP. Previous sector forecasts include technology, media and telecommunications, health careenergyconsumer goods and retail and financial services