View of the manufacturer…
Three times a year we conduct a wide-ranging survey of business owners across multiple sectors, including manufacturing – here are just some of our findings from our May research…
Finance
The most popular source of financial support and advice for manufacturers is their financial advisor (31%), followed by their accountant (26%) and their bank manager (21%). Bottom of the list is their peers at just 2%.
69% of manufacturing businesses plan to seek funding for business investment in the next 12 months.
14% of manufacturing firms have been declined access to finance in the past six months, while 29% have missed a business opportunity due to a lack of available finance.
Nearly half (48%) agree that taking out funding to protect cashflow is a good business strategy.
Nearly two thirds of manufacturing firms already use – or would consider using – an ‘alternative funder’.
The five most popular forms of funding are:
- Bank loans
- Credit cards
- Invoice finance
- Overdrafts
- Finance lease
If respondents were to take out finance in the upcoming year, they would spend it on:
- Investing in new assets
- Protecting cashflow
- Stockpiling supplies
- Improving current business premises
- Paying overheads
- Employing additional staff
- Moving to a new premises
- Mergers and acquisitions, or Management Buy Outs
Outlook
Asked about the UK’s economic prospects, 42% of business owners are confident the economy is set to grow compared to 39% who are of the opinion it’s going to slow down; the remaining 19% don’t foresee any significant changes.
A third of participating company bosses think their firm will expand in the coming months. Only 7% say they will contract – the remainder will ‘stay the same’.
Manufacturing firms’ top 10 main business concerns are, in order:
- Energy costs
- Materials supply
- Inflation
- Interest rates
- Cash flow
- Lack of skilled staff
- Late payments
- Tax / VAT
- Competitors
- Managing expansion
Their primary business priorities are:
- Achieving growth
- Developing products/services
- Investing in staff
- Survival
- Business consolidation
- Paying down debts
Late payments
Late payments are an issue for 38% of manufacturing businesses, with the majority owed between £20k and £40k. Over a third say late payments are more of an issue today than a year ago.
Recruitment
When it comes to being able to recruit adequately skilled staff, 48% are concerned about the skills gap in their sector; a further 19% have the same concern, but about their region. The rest don’t think there’s a problem.
Open Banking
55% know what ‘open banking’ is – 35% do not and the rest are unsure. Another 46% are confident they know how it works and 38% can see the benefits.
Events
Three out of five manufacturers attend industry events as a visitor while 48% exhibit, with 70% of the opinion events have an important role to play in showcasing the sector.
Nearly four in 10 think it would be detrimental to manufacturing if events were no longer held.
Cost of attendance is an issue for 43% of respondents.
Cost of doing business
75% of manufacturers have been impacted by the rising cost of doing business, with 56% saying it’s negatively impacted their cash flow.
71% have seen their business insurance rise, necessitating 89% (23% completely; 66% partially) to pass these additional costs onto their customers.
The top five inflationary pressures they’ve felt are:
- Energy (gas, electricity)
- Supplier costs
- Interest rates
- Fuel (petrol, diesel)
- Rent
Methodology
*All figures, unless otherwise stated, are from a Censuswide survey conducted in May 2024. The survey canvassed the opinion of over 900 SME owners across the UK and Ireland and across several industries on a range of issues affecting their businesses.
For more data, visit our SME Data Hub
Products and services are subject to eligibility, status, terms and conditions and availability. All lending is subject to status and our lending criteria. The right to decline any application is reserved.
