Dear reader,
If Q4 was about planning, Q1 is about pressure-testing the plan. The macroeconomic environment that greeted industrial buyers in early 2026 was materially different from the one they were budgeting against just three months ago. Geopolitical conflict has escalated from background noise to front-page disruption. Energy and freight cost volatility has forced real-time recalculations on capital commitments. And AI—already near-universal in supplier research last quarter—has moved into a new phase: buyers are no longer just using AI to search; they are increasingly comfortable delegating discrete procurement tasks to agentic workflows with no human supplier on the other end.
Against this backdrop, our data tells a nuanced story. Budget confidence has held up—remarkably so, given the headlines—but the bar for approval has risen sharply. More than half of respondents say the level of proof required to greenlight a major investment in 2026 is higher than it was a year ago. Pre-contact shortlisting, while still the dominant pattern among senior leaders, has softened at the aggregate level, suggesting that the uncertainty of the moment is pulling some buyers back toward live engagement earlier in the process. And on the supply chain front, geopolitical risk—which barely registered as a disruption factor in prior waves—has surged into the consciousness of nearly six in ten respondents.
The Industrial Buyer Pulse presented by Kula Partners was created to help manufacturers navigate precisely these kinds of inflection points. This Q1 2026 edition continues to trend our anchor KPIs—covering Buying Confidence, Research & Supplier Selection, Digital Buying Enablement, and Supply Chain Health & Risk—while introducing new spotlight questions on cost-shock response strategies, the evolving role of agentic AI in procurement, early-stage proof preferences, and the geopolitical lens now shaping supplier evaluation.
The findings you’ll see in the pages that follow are based on 303 North American decision-makers across the manufacturing landscape, including operations leaders, engineering and technical buyers, and procurement and supply chain professionals. Our intent remains the same as it was in our inaugural wave: to separate signal from noise by tracking a stable set of indicators over time, and to translate those indicators into actionable guidance for marketing and sales teams who are trying to align their plans, programs, and investments with how industrial buyers actually want to buy.
This Q1 report arrives at a moment when resilience, proof, and speed are the currencies that matter most. We highlight where budget confidence is holding under pressure, how buyers are recalibrating their shortlisting behaviour, which tasks they are now willing to hand to AI agents, and how geopolitical instability is fundamentally reshaping supplier evaluation criteria and buying strategy. We also examine what types of early-stage proof move the needle fastest, and how cost-shock scenarios are splitting the market between those who accelerate and those who retreat.
Our aim remains simple: to provide an always-current, decision-grade readout of industrial buying behaviour that helps manufacturers focus resources where they will matter most. We welcome your feedback and collaboration as we continue to evolve and deepen the Industrial Buyer Pulse in future waves.
Carman Pirie Principal, Kula Partners
Carman Pirie
Principal, Kula Partners
Key Findings
- Budget confidence holds steady despite a more volatile environment. The Q1 2026 Budget Confidence Index stands at 0.47, effectively flat compared with Q4’s 0.48 and still firmly in growth territory. The stability is notable: despite escalating geopolitical conflict and cost volatility, industrial buyers have not pulled back. Procurement and supply chain leaders remain the most bullish segments, while managers continue to lag significantly.
- The approval bar has risen—more than half of buyers say proof requirements are higher than a year ago. Fifty-five percent of respondents say the level of proof required to approve a major 2026 investment is higher than last year, with only 13% reporting a lower bar. This signals that while budgets are available, the internal case for release has become harder to make.
- Cost shocks split the market: “accelerators” outnumber “retreaters” by a wide margin. When asked how their organization would respond if energy, freight, or input costs rise sharply in the next 90 days, 38% say they would accelerate purchases before costs rise further—the single most common response. Another 16% would keep plans unchanged. Only 4% would freeze discretionary capital spending outright.
- Pre-contact shortlisting has softened—but seniority still defines the pattern. Across the sample, 76% of respondents placed at least one supplier on a shortlist before any live interaction, down from 83% in Q4. Among C-level and VP respondents, however, the figure remains above 90%, while only half of managers shortlist before speaking with a supplier—a stark and statistically significant divide (p<0.001).
- Third-party validation has overtaken all other forms of early-stage proof. When forced to choose the single type of proof they trust most at the earliest stage of supplier evaluation, 29% of buyers chose independent third-party validation or certification—the top response. Customer references (20%) and AI-generated comparisons (19%) followed, with supplier-authored documentation (15%) placing fourth.
- AI usage for supplier research has dipped slightly—but depth of influence has surged. Overall AI usage stands at 88%, down from Q4’s 92%. However, among those using AI, the impact is deepening: 56% say AI-generated summaries “often” influence which suppliers make their initial shortlist, and 86% say AI tools have made their evaluation process faster than a year ago.
- Buyers are ready to hand meaningful procurement tasks to AI agents. More than half of respondents (52%) say they would be comfortable allowing an AI agent to build an initial shortlist on their behalf without live supplier interaction. Nearly half (49%) would delegate summarizing technical differences, and four in ten would let an agent request pricing or lead-time information autonomously.
- Geopolitical risk has surged from background concern to top-tier disruption factor. Twenty percent of buyers now cite geopolitical risk among their top three logistics disruptions—more than double Q4’s 9%. High freight costs (60%) and customs and border delays (53%) remain the most frequently cited challenges, but the rise of geopolitical consciousness is the defining shift of this wave.
- Geopolitical conflict is actively reshaping buying strategy—not just awareness. Nearly six in ten respondents (59%) say geopolitical conflict or instability has significantly affected their evaluation of industrial suppliers in the past 90 days. When asked how continued conflict would most likely impact their buying behaviour, the top two responses were prioritizing suppliers with stronger delivery guarantees (31%) and shifting more spend to regional suppliers (30%).
- Freight, customs, and regulatory pressure form a persistent disruption triad. High freight costs (60%), customs and border delays (53%), carrier capacity shortages (41%), and regulatory changes (41%) dominate the logistics disruption landscape. Compared with Q4, freight and customs pressure has intensified while carrier capacity challenges remain elevated—confirming that disruption is structural, not episodic.
Buyer Confidence
Buyer Confidence
Capital budget outlook: resilient, but under scrutiny
The Budget Confidence Index for Q1 2026 stands at 0.47, essentially flat versus Q4’s 0.48 and still well within growth territory on the underlying −1 to +1 scale.
- This stability is remarkable given the quarter’s headlines: escalating geopolitical conflict, freight and energy cost volatility, and rising input prices have not, on balance, dislodged the expansionary posture of most industrial plants.
- More than 82% of respondents expect at least modest budget growth in the coming six months, with nearly one in five (20%) anticipating a significant increase.
Confidence varies by role, department, and company size
The averages mask meaningful segmentation:
- Job title: C-level and VP respondents remain the most optimistic (0.57), followed by Directors (0.51), while Managers are materially more cautious (0.32, p<0.001)—a pattern consistent with prior waves and widening slightly.
- Department: Procurement (0.57) and Supply Chain and Logistics (0.58) leaders report the strongest confidence, with Executive Leadership close behind (0.48). Operations is notably more muted at 0.39 (p=0.009).
- Company size: Large firms are most bullish (0.51), followed by medium firms (0.49), while small firms trail at 0.34 (p=0.025).
Implications for Marketers
- The resilience of budget confidence creates a window of opportunity—but the rising approval bar (see below) means that generic value propositions will stall. Proof-rich, application-specific content is the price of entry.
- Managers remain the most cautious audience. Risk-reduction messaging and payback-first narratives are essential when this segment is part of the buying group.
* To quantify respondents’ expectations regarding their capital expenditure over the next six months we’ve translated the original five-point Likert scale into a numerical index ranging from negative one, indicating a significant decrease, to positive one, indicating a significant increase, with zero representing no change. By averaging these values, the index provides a straightforward measure of overall sentiment, where a positive score suggests optimism and a negative score suggests pessimism.
The approval bar is rising: proof requirements for 2026
Compared with last year, the level of proof required to approve a major investment in 2026 is:
| Response | Percentage |
|---|---|
| Higher | 55% |
| Same | 32% |
| Lower | 13% |
More than half of respondents report that internal approval thresholds have tightened year over year. This is the clearest signal yet that while budgets exist, releasing them requires more compelling evidence—stronger ROI cases, better delivery assurances, and more rigorous third-party validation.
Implications for Marketers
- Budget availability and budget release are two different challenges. Marketing and sales teams that equip buyers with internal-ready justification materials—TCO calculators, benchmark data, peer comparisons—will outperform those relying on feature-led messaging.
- The 13% reporting a lower bar likely reflects organizations that have already locked in strategic priorities and are now in execution mode. For these accounts, speed and responsiveness matter more than additional proof.
How buyers would respond to a cost shock
If energy, freight, or input costs rise sharply over the next 90 days, respondents say their organization is most likely to:
| Response | Percentage |
|---|---|
| Accelerate purchases before costs rise further | 38% |
| Delay lower-priority purchases | 28% |
| Keep plans unchanged | 16% |
| Reduce project scope/specification | 12% |
| Freeze most discretionary capital spending | 4% |
| Not sure | 1% |
The dominant response—acceleration—underscores a market that has internalized the lesson of recent years: waiting often costs more than acting. Combined with the 16% who would hold steady, more than half the market would maintain or increase purchasing velocity in a cost-shock scenario.
Segment differences sharpen the picture:
- The “accelerate” response is strongest among procurement and supply chain leaders, who are closest to cost movements and most likely to act preemptively.
- Managers are proportionally more likely to favour scope reduction or delay, consistent with their more cautious confidence posture.
Implications for Marketers
- Cost-shock messaging should lead with “act now” urgency rather than “wait and see” caution. The data suggests most buyers will lean forward, not back.
- For the ~28% who would delay lower-priority items, the marketer’s job is to ensure their product or category stays in the “priority” column—through competitive urgency, regulatory timelines, or production-impact arguments.
Research & Selection
Research & Supplier Selection
Pre-contact shortlisting: still dominant, but softening
This is the first meaningful decline in our anchor pre-contact shortlisting metric, and it warrants careful interpretation. The drop does not mean buyers are abandoning digital research; it more likely reflects that in a period of heightened uncertainty, more buyers—particularly at the manager level—are seeking live validation earlier in the process.
Segment differences are stark and statistically significant:
- Job title: C-level and VP respondents shortlist pre-contact at 91%, Directors at 84%, but Managers at only 50% (p<0.001).
- Company size: Medium (82%) and large (78%) firms shortlist pre-contact at far higher rates than small firms (57%, p=0.001).
Implications for Marketers
- For senior decision-makers and mid-to-large enterprises, the digital-first shortlisting pattern remains firmly entrenched. Brand presence, content quality, and AI-readiness are still table stakes.
- The softening at the manager level creates an opening for sales-led engagement earlier in the funnel. Sales enablement should equip teams to add value in “exploratory” conversations that managers are increasingly initiating before a shortlist is locked.
Early-stage proof: what buyers trust first
At the earliest stage of supplier evaluation, when forced to choose a single type of proof, respondents say they trust:
| Proof type | Percentage |
|---|---|
| Independent third-party validation or certification | 29% |
| Customer reference from my industry | 20% |
| AI-generated comparison or summary | 19% |
| Supplier technical documentation | 15% |
| Distributor / channel recommendation | 13% |
| Trade show or in-person discussion | 4% |
| Analyst or media coverage | 1% |
Third-party validation’s dominance as the leading early-stage trust signal is a significant finding. It suggests that in an environment of rising proof requirements, buyers are looking first for credentialed, independent confirmation before engaging with supplier-authored or AI-curated content.
The emergence of AI-generated comparisons as the third most trusted proof type (19%)—ahead of supplier documentation—is a milestone worth noting. AI summaries are no longer just research tools; they are becoming proof artifacts in their own right.
Implications for Marketers
- Certifications, audit results, and third-party test reports should be prominent and easy to find—not buried in a compliance section. They are now the leading trust signal at the earliest evaluation stage.
- AI-generated content is earning buyer trust. Ensure your product data is structured, accurate, and available to the AI tools and comparison agents buyers are relying on. Inaccurate or missing data in AI summaries is now a competitive risk.
- Trade shows and analyst coverage, while still valuable for awareness, are not where early-stage trust is built in this market.
Digital Buying
Digital Buying Enablement
AI usage: still near-universal, but the depth story matters more than the breadth story
This is a modest dip from Q4’s 92%, but the headline number understates what is happening beneath the surface. The more important finding is about depth of influence and agentic comfort:
- Job title: 96% of C-level/VP respondents and 97% of Directors report using AI tools. Managers lag significantly at 69% (p<0.001).
- Among AI users, 56% say AI-generated summaries “often” influence which suppliers make their initial shortlist, with another 33% saying “sometimes.” Only 11% report rare or no influence.
- 86% say AI tools have made their supplier evaluation process faster than a year ago.
Implications for Marketers
- The slight aggregate dip in AI usage may reflect survey composition rather than a true retreat. Among the roles and seniority levels that drive most purchasing decisions, AI usage is effectively universal.
- The “often influences the shortlist” finding (56%) is the number that should command attention. This is no longer about whether buyers use AI—it’s about whether your brand appears, and appears favourably, in the AI-generated output they are acting on.
Agentic AI: which tasks buyers will delegate
Respondents were asked which supplier-related tasks they would be comfortable allowing an AI agent or automated workflow to complete on their behalf without live supplier interaction:
| Task | Percentage |
|---|---|
| Build an initial shortlist | 52% |
| Summarize technical differences between options | 49% |
| Identify candidate suppliers | 44% |
| Request pricing or lead-time information | 40% |
| Reorder previously approved items | 29% |
| Review compliance or certification documents | 28% |
| Configure a standard product | 28% |
| None of the above | 1% |
The willingness to delegate shortlist-building and technical summarization to AI agents is a watershed finding. These are not low-value administrative tasks—they are strategic evaluation steps that have traditionally required human judgment.
Segment differences:
- Job title: Managers are significantly more likely than senior leaders to delegate supplier identification (56% vs 39%, p=0.029) and compliance review (34% vs 18%, p=0.041)—perhaps reflecting their heavier administrative load. Senior leaders are more comfortable delegating configuration tasks (35% vs 17%, p=0.015).
- Department: Executive Leadership and Procurement teams show the highest comfort with technical summarization (60% and 58% respectively). Supply chain teams show notably lower comfort with compliance document review (5%).
Implications for Marketers
- If half your buyers are willing to let an AI agent build their shortlist, the question is no longer whether to optimize for AI discovery—it’s how fast you can do it. Structured product data, clear technical differentiation, and certification visibility are the inputs that AI agents will use to include—or exclude—your brand.
- The 40% comfort level with AI-driven pricing and lead-time requests signals that “request a quote” forms may soon be intermediated by AI agents. Manufacturers that offer API-accessible pricing and availability data will have a structural advantage.
AI’s influence on the shortlist: frequency and speed
How often do AI-generated summaries, recommendations, or comparisons influence which suppliers make your initial shortlist?
| Frequency | Percentage |
|---|---|
| Often | 56% |
| Sometimes | 33% |
| Rarely or never | 11% |
Compared with a year ago, AI tools have made our supplier evaluation process:
| Impact | Percentage |
|---|---|
| Faster | 86% |
| Same | 13% |
| Slower | 1% |
The “often” response—at 56%—is the single most important data point for any manufacturer thinking about content strategy and digital presence. Among C-level and VP respondents, the “often” figure rises to 75% (p<0.001), meaning three in four senior decision-makers now regularly act on AI-generated supplier intelligence.
The speed data (86% faster) reinforces that AI is compressing evaluation timelines. Suppliers that are slow to surface in AI-mediated research may find they are excluded before they are even aware an opportunity existed.
Implications for Marketers
- Content must be optimized for AI consumption, not just human readability. This means structured data, clear product taxonomy, prominent certifications, and up-to-date specifications that AI comparison tools can parse and surface accurately.
- Speed matters on both sides: buyers are evaluating faster, which means the window to influence a shortlist is shrinking. Always-on digital presence—not campaign-driven bursts—is the model that matches this reality.
Supply Chain
Supply Chain Health & Risks
Logistics disruptions: freight and customs pressure intensifies
Buyers were asked which up to three logistics-related challenges caused the most disruption to their operations in the past quarter. The leading issues:
| Disruption | Percentage |
|---|---|
| High freight costs | 60% |
| Customs & border delays | 53% |
| Carrier capacity shortages | 41% |
| Regulatory changes | 41% |
| Port/rail congestion | 28% |
| Geopolitical risk | 20% |
Compared with Q4, where high freight costs (54%), customs and border delays (49%), and carrier capacity shortages (47%) topped the list, the Q1 data shows freight and customs pressure continuing to build while geopolitical risk has more than doubled from 9% to 20%—the sharpest single-item increase in the survey’s history.
Segment differences:
- Job title: Managers cite high freight costs at 72%, significantly above Leadership (53%) and Directors (55%), suggesting that operational-level buyers feel cost pressure most acutely (p=0.015). Leadership and Directors are more likely to flag carrier capacity shortages (41% and 48% respectively) compared to Managers (30%, p=0.030).
- Company size: Large firms cite geopolitical risk at 31%, compared with 17% for small firms and 14% for medium firms (p=0.003)—likely reflecting their greater exposure to global supply chains.
Implications for Marketers
- The freight-customs-regulatory triad is now a persistent structural feature, not a passing spike. Reliability stories must address cost, timing, and compliance together rather than focusing narrowly on any one dimension.
- Geopolitical risk messaging is no longer premature or niche. One in five buyers now ranks it among their top three disruptions, and the figure is likely to continue rising.
Geopolitical conflict: from awareness to action
Another 29% report “some” impact, meaning nearly nine in ten buyers are factoring geopolitical dynamics into supplier decisions to at least some degree. Only 12% report little to no impact.
The impact varies by seniority and company size:
- Job title: Leadership (66%) and Directors (63%) report the highest “lots of impact,” while Managers are lower at 47% but still substantial (p=0.014).
- Company size: Medium (65%) and large (60%) firms report the highest geopolitical sensitivity, while small firms trail at 42% (p=0.029).
How buyers say continued conflict will reshape their strategy:
If geopolitical conflict continues to disrupt global markets over the next six months, respondents say the most likely impact on their buying behaviour is:
| Strategy | Percentage |
|---|---|
| Prioritize suppliers with stronger delivery guarantees | 31% |
| Shift more spend to regional suppliers | 30% |
| Delay major purchases | 14% |
| Increase buffer inventory | 13% |
| Seek lower-cost alternatives | 9% |
| No meaningful change expected | 4% |
The top two responses—delivery guarantees and regional sourcing—account for 61% of all answers. This is a clear signal that geopolitical uncertainty is translating directly into supplier selection criteria: buyers want assurance and proximity, not just price.
Implications for Marketers
- “Geopolitical resilience” is becoming a viable positioning pillar. Manufacturers with regionalized production, diversified supply chains, or demonstrated delivery performance in disrupted corridors should lead with these proof points.
- The 30% favouring regional shift is a direct opportunity for North American manufacturers and distributors to reframe nearshore capability as a competitive differentiator, not just a supply chain footnote.
- For the 14% who would delay purchases, the marketer’s task is to de-risk the decision—through guaranteed delivery windows, flexible terms, or staged procurement options that let the buyer commit without overcommitting.
About This Study
The data presented in this Buyer Pulse survey was collected in March 2026 via an online survey administered by InnovateMR, which implemented the following data quality measures in collection:
- Panel controls: fraud-prevention, digital fingerprinting, geo-verification, attention checks, and speed-trap removal.
- Screening: respondents confirmed (a) involvement in evaluating or purchasing production-critical goods/services in the prior 12 months and (b) familiarity with current supplier selection processes.
- Cleaning: de-duplication, straight-line and inconsistent-logic removal prior to analysis.
- Weighting: results are reported unweighted unless noted; small imbalances by role/industry were reviewed and deemed immaterial to the directional conclusions.
Respondents were selected via a double-opt-in B2B panel with the following profile:
- Role/Function: senior practitioners with direct influence over supplier selection and purchasing decisions, including Operations/Plant leadership, Engineering & technical buyers, and Procurement/Supply-Chain managers.
- Industry: North American manufacturing (e.g., industrial equipment, automotive, aerospace, food & beverage, specialty chemicals, metals, electronics).
- Company size: mix of small, mid-market and enterprise manufacturers (sub-US$100M to 1B+ revenue).
- Geography: United States and Canada.
All responses are aggregated and anonymized. No personally identifiable information (PII) or company-identifying information is disclosed. The study adhered to applicable standards for research privacy and consent, including panel partner policies and relevant data-protection regulations.
With a total sample size of 303 respondents, there is a 95% chance that the real value is +/- 5.53% of the measured value (assuming p=.6).
The survey was administered in English and took approximately 10-12 minutes to complete. The instrument combined trended anchors with a small set of rotating spotlights to keep the pulse fresh while preserving comparability wave-over-wave.
Anchors (tracked every wave):
- Buying Confidence: Change in 6 Month Capital Expenditure Budget = 5pt Likert scale of decrease to increase, with no change in the middle.
- Research & Selection: Pre-contact Shortlisting = % who placed any supplier on a shortlist before live contact.
- Digital Buying Enablement: AI-Assisted Research Adoption = % who used AI/chatbots/agents during supplier research (past 90 days).
- Supply-Chain Health: Logistics Pain-Point Heatmap = % selecting each disruption factor (multi-select).
Additional KPIs reported this wave:
Cost-Shock Response Strategy, Approval Bar Change (YoY), Early-Stage Proof Trust, Agentic AI Delegation Comfort, AI Shortlist Influence Frequency, AI Evaluation Speed Impact, Geopolitical Impact on Supplier Evaluation, Geopolitical Buying Strategy Response.
Things to note when reading this report:
- Rounding: Data are shown to one decimal place where relevant; columns may not sum to 100% due to rounding and multi-select questions.
- Totals and bases are indicated on charts and tables where space allows.
- Segment cuts (e.g. role, industry, company size) are provided where statistically robust; smaller bases are noted.
For questions regarding methodology or custom segment analyses, please contact research@kulapartners.com.