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Haines Watts Hereford Phone icon 01432 273189

Many industries have experienced dramatic change due to digital transformation, but none handles adaptation and adoption like manufacturing.

Andrew Jones explores the manufacturing industry’s proven ability to adapt and why this stands it in excellent stead to maximise the opportunities presented by challenges ahead:

 

The digital challenge

The manufacturing industry continues to evolve and transform at an accelerated rate. With so many pressures and influences, this is not an industry known for sitting on its hands.

Over the years the manufacturing industry has had to adapt for number of reasons. The biggest disruptor it has faced is technology. Factories are being digitised, filled with new computers and 3D printers to make them quicker, more flexible, and more efficient.

Robots are doing much of the dirty, repetitive and dangerous jobs that humans were doing for years, producing better goods at lower prices. Once the process of computerising machinery started, the industry had to react quickly, because if a manufacturer doesn’t keep up with the efficiencies that automation allows, then ultimately their products are going to be more expensive.

Tech savvy manufacturers knew from the start that they could pass on savings made by efficiencies to potential customers.

 

A confidence boost

In terms of speed of uptake on the huge technological advances the industry has faced, in my experience most clients have embraced it.

In cutting edge fields such as the automotive or aerospace industries, they have adapted very quickly, but some of the smaller companies have found it more difficult to invest, and some have had to hold back because of the uncertainty pre the election and around Brexit, possibly choosing to repair old machinery rather than invest in new.

There may be a long road ahead, but the election result and definite Brexit date seems to have steadied the nerves somewhat. Confidence is already higher. What is critical now is that manufacturers adapt quickly again to opportunities that this more buoyant and upbeat environment presents.

 

Exporting to a new world

A lot of the companies I work with export to a number of different counties and they need to look closely at the different trade deals that are going to be put into place over the coming months. A number of commonwealth countries – Canada in particular – are keen to put really good trade deals in place.

Arguably, Canada has already proven itself to be the most attractive place for one particularly high-profile British export!

It’s important for manufacturers of all sizes not to feel intimidated by what is to come and to see change as a force for good and a chance to grow and more into different territories. There are many places you can go to for help and advice.

I’d suggest starting with the Chamber of Commerce with its wealth of resources on local customs and trade. We do a lot of work with clients who think their future is in export from an accountancy and legal perspective.

Our global alliance means that we can put you in touch with accountants and lawyers in the countries you may want to export to, as well helping you with VAT, tax and accounting issues in the UK.

 

The beating heart of our economy

According to the Office of National Statistics, manufacturing contributes £6.7 trillion to the global economy with the UK currently the world’s eighth largest industrial nation.

If current growth trends continue, the UK will break into the top five by 2021. In the UK, manufacturing makes up 11% of GVA, 44% of total UK exports, 70% of business R&D, and directly employs 2.6 million people.

As long as manufacturers face the challenges ahead with the same determination and ability to adapt as they have in the past, the future will see new markets opening up, enabling them to expand and grow and continue to be the powerhouse of the UK economy.

 

We have a strong history of working with supporting manufacturing businesses in and around the West Midlands.
If you’d like to talk about the future of your manufacturing business, get in touch or request a call back from one of our specialists.

Want to know more? Call us on 01432 273189 or email hereford@hwca.com

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