East Midlands manufacturers target home comforts to boost long-term growth
Manufacturing Advisory Service Newsletter – October 21, 2014
Small manufacturers in the East Midlands are set to make the most of a strengthening UK economy by focusing on domestic markets for their future growth it was revealed today. More than two thirds (68%) of companies questioned in the latest Manufacturing Advisory Service (MAS) Barometer feel that increasing sales at home offered them the best chance to expand.
This was followed by firms looking to boost export performance (36%), improving production processes and a strong focus on new product development.
There also appears to be significant confidence in longer-term growth as respondents predict an 84% rise in collective turnover and staffing levels to increase by 57% over the next four years.
The latter could equate to thousands of new jobs across the SME manufacturing base.
“There is significant confidence in the domestic marketplace at the moment, a further signal that the recovery has taken hold,” explained David Caddle, Area Director of the Manufacturing Advisory Service.
“We’ve seen unrivalled investment in the UK automotive industry and that is cascading down the supply chain and creating new opportunities. Our reputation for low carbon advancement should also be another growth sector and I’m sure our manufacturing SMEs will be in line to take advantage of major infrastructure projects, such as High Speed Rail.”
He continued: “As part of the long-term focus, we also asked respondents about their biggest strengths, with the quality of senior leadership teams (72%) coming out on top, followed by innovative products (65%) and robust strategy (64%).
“It was not surprising to discover that the biggest challenge is access to skills (70%), whilst marketing and creating effective sales channels were the next major concerns. We will work with partners like GrowthAccelerator and SEMTA to help SME manufacturers overcome these challenges.”
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 MAS Barometer shared the views of 97 small manufacturers across the East Midlands, employing more than 1800 people and realising turnover in excess of £114m.
The results maintain the positivity seen in previous findings, with 64% of companies increasing sales in the last six months and 73% expecting to grow between now and the end of the year – 10% improvements respectively on this time last year.
Similar to last quarter, nearly two thirds of firms (64%) are looking to recruit and create new jobs, which is a 22% rise on 2013.
David continued: “Despite recent economic surveys reporting a slight dip in manufacturing performance, it appears the smaller firms are still confident of growing, especially when you compare the key performance indicators with the figures from last summer.
“Everything we monitor, including sales, future growth, jobs and investment, are all up across the board so we can see the short-term outlook is very positive. Thanks to our specific focus this quarter, we also know there is longer-term confidence and the areas of concern manufacturers need support to address.”
Pressac Communications was one of the companies questioned in the MAS Barometer and reflects the sustained confidence seen across the East Midlands.
The Nottingham-based company designs and manufactures electrical and electronic solutions and is setting its sights on expansion after diversifying into supplying energy harvesting products into the Building Management Systems (BMS) sector.
“Traditionally, our core business has been working with blue-chip customers in the automotive, industrial and telecommunication sectors – customers including British Telecom, 3M, Eircom and Ford,” explained Caroline Smith, Marketing Manager.
“Whilst we will maintain our traditional business, we are increasingly focusing on: new product development; diversification into new sectors and markets and capitalising on our unique selling points.”
Pressac has a 60-year history of manufacturing, technical expertise and design innovation.
From this position of proven expertise and extensive technological understanding, the company is now exploiting its ability to provide value added design services to develop innovative product solutions for new markets.
One such sector is BMS, with the firm investing heavily in developing the Pressac Sensing range of energy harvesting, wireless devices for smart energy monitoring.
Smith concluded: “Our entry into the BMS is very timely, as legislation – along with a growing awareness and desire to conserve energy and reduce costs – demands that businesses address their energy usage by taking measures to monitor and improve energy performance. Products from the Pressac Sensing range can assist with this and can also facilitate reduced running costs for buildings.”
Pressac Communications employs around 50 people at its Bilborough headquarters, where its primary manufacturing division, sales and marketing, design and R&D departments are located. The company is expecting to grow sales by 100% over the next 3 years.
Also, Pressac was delighted to be invited to appear on the Sunday Politics Show recently, as part of a feature on manufacturing in the East Midlands. Check out the footage here (Pressac appears around 41 minutes into the programme)