South West manufacturers look at home markets to drive growth
Small to medium sized manufacturers in the South West identify sales into home markets as the most important way of achieving growth over the next five years, according to the latest Barometer survey from the Manufacturing Advisory Service.
Almost two thirds (62 percent) of respondents highlight capitalising on opportunities at home as being key to realising their growth potential, with innovative products appearing to be the main driver for this, as 68 percent of businesses report this to be their strongest quality.
Simon Howes, MAS area director for South West England, said: “Our Barometer suggests that the growth ambitions of the region’s manufacturers may be domestic-led in the short to medium term.
“Manufacturers’ confidence in targeting opportunities at home may also be due to the ongoing upturn in the UK’s economy, as evidenced by recent figures from the Office for National Statistics, which revealed the fastest growth rate since 2008.
“The UK is clearly moving ahead with investments planned or underway in many areas including Hinkley Point, Crossrail and HS2, and it is great to see our manufacturers tuning in to these opportunities as well as exploring key growth sectors such as marine and offshore wind.
“What is most important is that businesses have a clear understanding of opportunities in all markets, including those overseas, matching this with the right capacity, capabilities and processes to build a solid base for growth.
“Overall, manufacturers will need a robust strategy, something that more than four in ten respondents report as being their biggest challenge.
“MAS has considerable experience in helping manufacturers with their strategy, working at boardroom level to identify how a company is operating and the vision for the business moving forward. Having a clear strategic direction in place will impact positively on profitability and growth.”
Business minister Matthew Hancock said: “This is yet more good news for British manufacturing which shows a more balanced recovery is really taking hold now.
“These many thousands of jobs that promise to be unlocked in manufacturing will help families across the country and that’s the whole point of our long-term economic plan.”
The Barometer also revealed that 58 percent of SME manufacturers in the South West increased sales in the last six months and nearly three quarters (72 percent) expect sales to rise between now and the end of the year.
This confidence appears to have had a positive effect on recruitment plans, as almost half (47 percent) of companies indicate that they intend to hire more staff over the next half year.
Mr Howes added: “The intention to create new jobs is encouraging but this is a trend that some companies may find hard to realise if sales forecasts are not achieved. Investment in training and retention is vital, particularly given that 71 per cent of businesses identify access to skills as the biggest barrier to achieving growth.
“We can support manufacturers with this by imparting knowledge and skills, as well as providing access to partner organisations such as our colleagues at UK Trade & Investment (UKTI), who will also be well placed to help businesses when their focus turns to exporting.
“Looking to target overseas markets is something that we strongly advise companies research and consider. UKTI will be able to assist with this by helping manufacturers review if their products are suitable for exporting or if they will need to be adapted in any way.”
For more information on MAS and the services it provides, call 0845 658 9600, email firstname.lastname@example.org or visit www.mymas.org