Manufacturers told to set sights higher

Simon Howes

The outlook for the south west’s manufacturing businesses remains encouraging, but more needs to be done to enable many of them to take vital next steps towards achieving their full growth potential.

That’s the conclusion of the latest manufacturing Barometer, which is conducted quarterly by the Manufacturing Advisory Service in the South West (MAS-SW) to provide a snapshot of regional manufacturing trends.

The majority of respondents (55%) reported an increase in sales turnover in the last six months with 57% expecting turnover to increase in the second half of the year.

Almost one in three (29%) plan to recruit over the next six months with a further 62% maintaining their current staffing levels; 42% intend to invest in new machinery or premises this year while 34% plan to invest in new technology.

Generally, these figures are slightly lower than those reported in the previous quarter (January to March 2011), but overall growth has continued.

However, MAS-SW’s Barometer also reveals a significant reduction in the number of new customer enquiries, with just 37% of respondents reporting an increase in enquiries compared to 64% in the previous quarter.

MAS-SW says more work needs to be done to accelerate growth. MD, Simon Howes, commented: “There appears to be some disparity between the confidence expressed by manufacturers in the south west and their predictions for growth, when evaluated against the number of new enquiries they have received.

“It is interesting to note that the majority of respondents – some 72% – believe their current market can sustain their ambitions for growth and 93% say they have the capacity within their company to increase production to meet demand.

“The Barometer reflects a cautiously optimistic attitude to growth but we believe many manufacturers could – and should – set their sights higher.”

More than two-thirds (79%) of manufacturers who responded to MAS-SW’s Barometer said they had considered exporting their products, but highlighted two main challenges: a lack of marketing know-how (29%) and difficulties in obtaining finance (29%).

Nearly half the respondents (44%) admitted they did not have the in-house resources to enable them to target an overseas market – and 29% said they would need help in adapting their products to meet foreign standards.



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