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in partnership with

Manufacturing Barometer Results:

National Q3 (October, November and December 2016)

Surveyed in January/February 2017

.

© SWMAS Ltd 2017. No part of this report may be reproduced without the express permission of SWMAS.


Manufacturing Barometer Q3 2016

Contents

UK Industrial Strategy – Is the

UK doing enough to build its reputation as

a stable and predictable business

environment?

• Introduction

• Business Aspirations

• Survey Demographics

• Measuring Trends

• Special Focus

• About the Manufacturing

Barometer

in partnership with


Introduction

Welcome to the latest Manufacturing Barometer collecting the results, views and opinions

of manufacturing SME’s.

Senior decision makers within small and medium sized manufacturers have shared their views on

UK Industrial Strategy and whether the UK is doing enough to build its reputation as a stable and

predictable business environment.

The Core Trends

SME manufacturers across the UK have remained resilient with 57% of firms experiencing an

increase in sales turnover in the past six months, up from 48% in the last survey, and 6% up from

the same period last year. There has also been a noticeable jump in future turnover expectations,

increasing from 59% last quarter to 66% .

Simon Howes

Managing Director

SWMAS Group

An increased investment in both new technology and new machinery over the past 6 months has

decreased slightly from last quarter’s survey, dipping from 44% to 42%. However, firms are

forecasting increased investment within the next 6 months, with 50% expecting to increase their

spend, compared to 45% last quarter.

Finally, there has been a 3% decline in the number of firms expecting to increase employment in

the next six months, decreasing from 49% last quarter to 46%. However, this percentage shows

there is still a significant number of businesses looking to recruit, which is good news for the

sector and for the UK economy as a whole.

The Special Focus

In this quarter’s survey we sought to understand SME manufacturers thoughts on UK Industrial

Strategy.

Continued Overleaf...

in partnership with


Introduction

Perhaps the key finding is that a surprising 42% of respondents, don't know whether UK

Industrial Strategy is built to deliver their business needs, clearly showing their is a lack of

visibility and understanding amongst SME manufacturers throughout the UK.

When asked what should be the main focus for UK Industrial Strategy, R&D and Productivity

were clearly high on the priority list for businesses, closely followed by Access to Growth

Opportunities within the UK, Export and Operational Skills.

Conclusions

The overall picture seems clear - although remaining resilient, SME manufacturers are feeling

disconnected from Industrial Strategy and considering SMEs make up over 90% of businesses in

the UK, it is an issue that needs addressing. The budget – with additional money for disruptive

technology and new T-Levels to boost technical skills – showed there is an appetite to support

manufacturing and we’d urge Government to listen to SMEs as we move forward.

Simon Howes

Managing Director

SWMAS Group

in partnership with


“Small but steady UK growth and significant export growth in selected

markets.”

Ratman

“Grow into purchased Unit within 5 years and develop

knowledge base staff skills.”

“To consolidate and grow our current export business in

Japan and to start significantly exporting to the USA,

South Korea, China, Australia and Canada ”

Tom Smarte, London

“Growth in current markets. Investing in new

technology for growth and develop own product to

reduce risk from higher in supply chain. ”

Groveley Precision Engineering

“Min 10% growth in turnover and profitability per year and to at least double in the next 6-7 years. Also to

have our own purpose built factory.”

“Increase output capacity so that we don't have to turn away orders ”

Proline Engineering Ltd

Business Aspirations


Manufacturing Barometer Q3 2016

Survey Demographics

20%

3%

4%

7%

Chair of the Board

Finance Director

Managing Director

Operation Director

Other

66%

Over 66% of respondents were managing directors.

Individuals who are in the business, hands-on, running it day-to-day.

326 Respondents

in partnership with


Manufacturing Barometer Q3 2016

Past Sales

90%

80%

How has your sales turnover changed within

the past 6 months?

Much Reduced/Reduced

Much Increased/Increased

70%

60%

50%

51% 49%

51%

48%

43%

48%

57%

40%

30%

20%

10%

0%

-10%

-20%

-30%

-40%

-27% -28%

-32%

-28% -30%

-24%

-22%

-50%

Q1_2015 Q2_2015 Q3_2015 Q4_2015 Q1_2016 Q2_2016 Q3_2016

318 Respondents

in partnership with


Manufacturing Barometer Q3 2016

Future Sales

90%

How do you expect your sales turnover to

change over the next 6 months?

Much Reduced/Reduced

Much Increased/Increased

80%

70%

60%

64%

72%

66%

69%

59% 59%

66%

50%

40%

30%

20%

10%

0%

-10%

-20%

-30%

-11% -9%

-11% -10%

-18% -19%

-13%

-40%

-50%

Q1_2015 Q2_2015 Q3_2015 Q4_2015 Q1_2016 Q2_2016 Q3_2016

317 Respondents

in partnership with


Manufacturing Barometer Q3 2016

Past Employment

90%

80%

70%

60%

50%

40%

30%

20%

10%

0%

-10%

-20%

-30%

-40%

-50%

41%

-18%

38%

-23%

How have staff numbers in your company

changed in the past 6 months?

40%

-19%

35%

-25%

31%

41%

-22% -23%

Much Reduced/Reduced

Much Increased/Increased

Q1_2015 Q2_2015 Q3_2015 Q4_2015 Q1_2016 Q2_2016 Q3_2016

37%

-19%

316 Respondents

in partnership with


Manufacturing Barometer Q3 2016

Future Employment

How do you expect staff numbers in your

company to change in the next 6 months?

Much Reduced/Reduced

Much Increased/Increased

90%

80%

70%

60%

50%

46%

52%

45%

51%

44%

49%

46%

40%

30%

20%

10%

0%

-10%

-20%

-6% -6%

-10% -9% -9% -10%

-7%

-30%

-40%

-50%

Q1_2015 Q2_2015 Q3_2015 Q4_2015 Q1_2016 Q2_2016 Q3_2016

318 Respondents

in partnership with


Manufacturing Barometer Q3 2016

National Past Capital Investment

How has your investment in new

machinery/premises changed in the past 6

months?

Much Reduced/Reduced

Much Increased/Increased

90%

70%

50%

51%

41%

45% 44%

37%

44% 42%

30%

10%

-10%

-6% -6% -8%

-3%

-11% -10% -9%

-30%

-50%

Q1_2015 Q2_2015 Q3_2015 Q4_2015 Q1_2016 Q2_2016 Q3_2016

318 Respondents

in partnership with


Manufacturing Barometer Q3 2016

National Future Capital Investment

90%

80%

70%

60%

50%

40%

30%

20%

10%

0%

-10%

-20%

-30%

-40%

-50%

50% 50%

How do you expect your investment in new

machinery/premises to change in the next 6

months?

56%

-5% -6% -7%

47%

-3%

41%

45%

-14% -12%

Much Reduced/Reduced

Much Increased/Increased

Q1_2015 Q2_2015 Q3_2015 Q4_2015 Q1_2016 Q2_2016 Q3_2016

50%

-9%

317 Respondents

in partnership with


Manufacturing Barometer Q3 2016

National Past New Technology

90%

80%

70%

60%

50%

40%

30%

20%

10%

0%

-10%

-20%

-30%

-40%

-50%

46%

How has your investment in new technology

changed in the past 6 months?

40% 40%

44%

-3% -3% -3% -3%

33%

-8% -10%

Much Reduced/Reduced

Much Increased/Increased

36% 37%

Q1_2015 Q2_2015 Q3_2015 Q4_2015 Q1_2016 Q2_2016 Q3_2016

-7%

318 Respondents

in partnership with


Manufacturing Barometer Q3 2016

National Future New Technology

90%

80%

70%

How do you expect your investment in new

technology to change in the next 6 months?

Much Reduced/Reduced

Much Increased/Increased

60%

50%

40%

46%

51%

49%

47%

41%

44% 44%

30%

20%

10%

0%

-10%

-20%

-3% -4% -4% -3%

-9% -10%

-7%

-30%

-40%

-50%

Q1_2015 Q2_2015 Q3_2015 Q4_2015 Q1_2016 Q2_2016 Q3_2016

317 Respondents

in partnership with


Manufacturing Barometer Q3 2016

Special Focus – What key thing do you feel Government need

to address to help better support the growth of UK

manufacturing?

Access to markets and

less complicated finance

structures...

Understand that the

power house of

manufacturing in the

UK is not the blue chip

companies but the

SME's - and then

support them...

in partnership with


Manufacturing Barometer Q3 2016

Special Focus – What do you believe should be the main focus

for UK Industrial Strategy?

Access to finance

Making it easier for foreign firms to invest in the UK

Access to growth opportunities within the UK

Process Innovation & Automation

Skills - Operational

Skills - Management

Skills - Board Level

Not at all important

Slightly important

Important

Fairly important

Very important

Productivity

Export

R&D

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Respondent numbers vary

in partnership with


Manufacturing Barometer Q3 2016

Special Focus – Do you believe current industrial strategy is built to

deliver you business needs?

Don't know

Disagree

Completely disagree

Completely agree

Agree

270 Respondents

0 20 40 60 80 100 120

in partnership with


Manufacturing Barometer Q3 2016

About the Manufacturing Barometer

The Manufacturing Barometer is a quarterly survey that charts the experiences of UK SME

manufacturers. It is the largest survey of its kind and has informed both government industrial

strategy and the national debate on manufacturing.

Run by SWMAS since 2009 in the South West of England, the Manufacturing Barometer records

trends in employment, turnover and investment. Each quarter, a ‘special focus’ explores an issue in

greater depth. In the past this has included issues such as productivity, overseas production and

energy efficiency.

Companies are able to use this quarterly Manufacturing Barometer to compare themselves against

other firms within their sector or region.

For more information please contact:

info@swmas.co.uk

0845 608 3838

in partnership with

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