UK Market Barometer reveals SMEs must improve productivity
UK – In the latest National Manufacturing Barometer survey on the business climate among SMEs in the UK, findings note the highest figure in sales in nearly three years.
The quarterly survey discusses performance focussing on productivity and the extent to which it is engrained in the manufacturing business culture.
- 72% of SME manufacturers are predicting an increase in sales in the next six months
- 56% plan to invest in machinery and premises
- Nearly half plan to recruit more staff over the next six months
- 70% are confident that productivity is engrained at a strategic level
Conducted by SWMAS (part of the Exelin Group) in partnership with Economic Growth Solutions (EGS), the Manufacturing Barometer asked 320 small to medium-sized manufacturers (SMEs). It reported that these manufacturers say they must improve productivity by unlocking “their own hidden potential” for sales and profits growth to meet expectations.
Some 72% anticipate an increase in sales in the next six months, which is the highest figure recorded in almost three years. Another indication of confidence in the sector is reflected by 59% who note that they are expecting increased profits over the next six months.
On the other hand, 45% of the manufacturers actually experienced increased profits in the second half of 2017. Thus, the gap between anticipated sales growth and actual recent improvements in profits continues to raise questions about productivity, especially the ability of manufacturers to meet their own growth targets.
On the more positive side, 56% of the manufacturers indicate that they aim to deliver against their growth targets by investing in machinery and premises, which actually is a rise of 13% over the last report. Moreover, 48% plan to recruit new staff, which is 2% higher than the same time last year. This suggests that improving productivity through the existing workforce and facilities remains the key focus, so the report.
The survey also explored the extent to which manufacturers have integrated productivity into their business and workplace culture.
About 70% are confident that productivity is engrained at a strategic level but almost half indicated they would like to achieve better, and sustainable, productivity improvements, pointing to the need to improve engagement with staff to deliver and sustain change.
Simon Howes, CEO of Exelin Group, said: “Confidence levels are riding high in the manufacturing sector despite market uncertainties, demonstrating the strength and resilience of our SME manufacturers.”
The Manufacturing Barometer asks senior decision makers for their views on factors influencing business performance and the future of the sector. This survey covers the business operating period for winter 2017 (October, November and December 2017) with businesses surveyed in January 2018. UK SME manufacturers wanting to add their voice can sign up to contribute to the next Manufacturing Barometer at www.swmas.co.uk.