Manufacturing 2018, part 1: Growth Street’s look at the year ahead in manufacturing

In this first of our three-part series looking ahead to 2018 for the manufacturing industry, we aim to consolidate crucial facts and figures from multiple sources into one concise summary. We’ll give you our take on what SMEs might wish to look out for over the next 12 months.

Economic and political events could affect vital industries, including manufacturing. At the same time, we are seeing new waves of technology-led innovation that may lead to new opportunities for manufacturers. So what should UK manufacturing businesses be looking out for?

Positive signs from 2017

The manufacturing industry is incredibly diverse, of course. A food manufacturer will inevitably face different challenges than a construction engineering firm over a given period of time. At the same time, we can see that some key macroeconomic trends could affect many kinds of manufacturing business over the next 12 months: 

Manufacturers - and, indeed, businesses of all stripes - should pay close attention to developments as the Brexit process continues. Labour from the EU is an important component of many manufacturers’ workforces.

Defining factors for 2018

2018 could be a defining year for manufacturing businesses and for the UK’s economy more generally. We think the following challenges may be relevant for manufacturers during 2018:

  • Domestic demand. IHS Markit said that manufacturing demand was strong in November 2017, which could bode well for the new year. But in an unpredictable economic climate, maintaining the pace of new orders could be crucial.
  • Potential workforce pressures. Manufacturers - and, indeed, businesses of all stripes - should pay close attention to developments as the Brexit process continues. Labour from the EU is an important component of many manufacturers’ workforces.
  • Availability of external finance. Access to finance was recognised by EEF as a key barrier to investment.
  • Struggles with automation and productivity. The UK has reportedly been slower to automate processes than other developed economies. In addition, productivity is a long-standing problem which politicians have vowed to tackle across industries.

At Growth Street, we know how important manufacturing businesses are to the economy. We want manufacturers to have the support they need to grow with confidence. Issues that can challenge UK manufacturers - such as the rising cost of materials, the continuing need to update machinery to improve productivity, and uncertain demand - may make it difficult to plan for future success.

Because we understand these challenges, we created GrowthLine, a business finance product that gives you more flexibility when managing cash flow and working capital. GrowthLine works much like an overdraft: once we give you your facility limit, you can draw down funds and make repayments as often as you like. Find out more about how GrowthLine could help you execute your 2018 growth plans, or start your application now.

Head here to read the second instalment of our series on manufacturing, which focuses on workforce trends. You can read our final piece, which looks at productivity, here.

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Written on in Business Insights