A recent report jointly published by Make UK, NatWest, and Lombard sheds light on the substantial investment opportunities available to Britain’s manufacturers, potentially amounting to an impressive £10 billion over the next year. The integration of diverse public and private finance options could unleash up to a fifth increase in sector-wide investment, a move crucial for addressing the UK’s persistent productivity challenges.
Key findings from the report underscore the significant impact of improved access to finance on manufacturers’ investment intentions. Over a quarter of surveyed companies (26%) express readiness to increase their investment by up to a fifth, while 12% are poised to boost investment by as much as half, provided access to finance is enhanced.
Crucially, the report identifies critical areas for investment, including capital equipment, automation, energy efficiency, and cybersecurity, essential for positioning the UK competitively in the race towards sustainability and technological advancement.
However, despite the potential benefits, barriers to accessing finance persist. A staggering 54% of companies remain unaware of the array of public finance sources and tailored government schemes available to manufacturers. Moreover, domestic economic and political uncertainties, alongside the looming threat of increased costs, further deter manufacturers from pursuing finance options.
Fhaheen Khan, Senior Economist at Make UK, likened access to finance to fuel for manufacturers, stressing its pivotal role in sustaining continuous investments essential for navigating the sector’s dynamic landscape.
Laura Capper, Head of Manufacturing and Construction at NatWest, emphasized the importance of external finance in supporting manufacturers’ growth, innovation, and sustainability endeavors. Capper highlighted the need for collaboration among manufacturers, lenders, and other stakeholders to streamline access to flexible funding solutions.
The report estimates that unlocking manufacturers’ investment potential through private and public finance sources could inject £9.2 billion into the sector within the next twelve months alone, complementing existing investments in capital equipment and research and development.
To address the knowledge gap surrounding finance options, the report calls for the establishment of a centralized database to streamline access to both public and private provisions. Such a measure, supported by nearly half (48%) of surveyed companies, could leverage digital technologies like AI and digital dashboards to enhance awareness and facilitate informed decision-making among manufacturers and lenders alike.
In conclusion, the report underscores the imperative of bridging the gap between manufacturers and available finance options to propel the sector’s productivity, innovation, and competitiveness in the global market landscape.