Welcome to the neighborhood. It’s an apt greeting for many of the manufacturing companies that make up the 2021 IndustryWeek 50 Best U.S. Manufacturers, IW’s exclusive annual ranking of the United States’ top-performing manufacturing companies. A wealth of new companies have muscled out familiar faces.
Let’s share a few quick examples. More than half (27) of the 50 manufacturers that comprise this year’s list were not on IW’s last full ranking, which occurred in 2019, including four of the top five manufacturers, five of the top 10, and 11 of the top 20. By contrast, “familiar” aptly described the top tiers of the 2019 IW 50 Best, which listed 20 new members compared with the previous year, none of which charted above the 14th position. Moreover, four of 2021’s new entrants—including Boston Beer Co. Inc., which ranks No. 3 in the 2021 IW 50 Best—leaped into the charts in their first year of eligibility, having achieved the revenue necessary to be considered.
Also: View an interactive database of The IndustryWeek 50 Best U.S. Manufacturers
Why the upheaval in the rankings? Without question the pandemic played a role, although how much is likely to remain an eternal question. A handful of the companies that fell off the 2021 IW 50 Best list are motor vehicle suppliers and steel companies, both closely aligned with an automotive industry that collapsed for a significant chunk of 2020. Nevertheless, some churn is inevitable from year to year, although that churn has steadily increased since 2018, when just 11 manufacturers were new to the rankings.
So who are some of the new players in 2021? Say hello to BWX Technologies Inc., which nabbed the top spot on the IW 50 Best after not appearing on the 2019 charts. This manufacturer, which for many years was part of Babcock & Wilcox Co. before being spun off in 2015, provides nuclear solutions for national security, environmental remediation, nuclear medicine and more. Its 2020 revenue set a company record at more than $2.1 billion and it led all IW 50 Best manufacturers in inventory turns, with nearly 97. Another company with a strong government connection, defense contractor Lockheed Martin Corp., took the No. 2 spot.
Perhaps the most intriguing addition to the IW 50 is Boston Beer Co., whose brands include Samuel Adams, Twisted Tea and Angry Orchard. It rocketed from nowhere to the No. 3 spot, just ahead of Apple Inc., which also held the No. 4 position in 2019 and is a regular among the IW 50 Best.
Boston Beer Co. had its struggles in 2020, with COVID-19 drying up keg demand in its on-premise channel. Still, direct-to-retail shipments grew 37% over the previous year, and net revenue rose almost 39%, according to its full-year earnings results. The beverage maker also achieved an 11% profit margin and return on assets of 18%.
Let’s conclude with a few additional data points:
- 13 of the manufacturers that appeared on the 2019 IW 50 Best and returned again in 2021 saw their rankings either remain the same or improve.
- The biggest gain among returning manufacturers was 28 spots, held by PepsiCo Inc., which rose to No. 18 in 2021 from No. 46 in 2019.
- The biggest slide belonged to Cintas Corp., which dropped 44 spots to land at No. 50.
IW 50 Best Selection Process
Earning a spot on the IW 50 Best ranking, no matter which position, is a challenging endeavor. No single metric or single year of excellence will earn a manufacturer a spot among the top performers. IndustryWeek has developed a precise formula to identify the IW 50 Best U.S. Manufacturers. First, the IW 50 is drawn from the IndustryWeek U.S. 500, our annual listing of the top 500 publicly held U.S. manufacturing companies based on annual revenue for the most recent fiscal year. From there, we examine six additional measures—a combination of operational and financial—over a three-year time frame. Those measures are inventory turns, profit margin, asset turnover, return on assets, return on equity and revenue growth. The most recent year’s numbers are the most heavily weighted, at 50% of the formula we employ.
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