Develop manufacturing supply through local sourcing

14 September 2012

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16 September 2012 | Adam Leach

Buyers at UK manufacturers should spend their cash closer to home to support and develop the domestic supply chain.

Rebuilding the UK Manufacturing Supply Base, published this week by the Cranfield School of Management, also called for the government to develop a strategy that supports the supply chain rather than just support firms that are already succeeding.

The report said: “Future policies should acknowledge a supply chain rather than single firm perspective.”

It added: “The role of the larger companies in shaping their supply chains and developing their suppliers is crucial and should be incentivised.”

It said that initiatives from the Technology Strategy Board and the Treasury were along the right lines in terms of sentiment but called for an increase in tangible action, particularly to support SMEs.

Alan Braithwaite, director of supply chain research at Cranfield and chairman of LCP Consulting said: “The government should actively integrate initiatives and drive measures to and drive the measures to make UK manufacturing a winner again.”

The study also called for greater focus and government support for the UK manufacturing sector, increases support from banks for SMEs and an increase in manufacturing apprenticeships to strengthen the capability of the industry in the UK.

The report explained while 42 per cent of companies are exporting on the global market, just 23 per cent of those firms are SMEs. As a result it is calling for an increase in resources and support for small or medium companies participating in the automotive supply chain.

Promoting the value of indigenous supply, the report argued sourcing from UK vendors lessens the risk of disruption, citing last year’s Tsunami in Japan. “Outsourcing production verses dramatically enhances the risks in the supply chain. This was evident after the Tsunami in Japan in 2011 which caused widespread chaos within the automotive supply chains across the globe,” it said.

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