‘Keeping manufacturing in the UK even more important than reshoring’

15 May 2015

More companies are keeping manufacturing in the UK and this is even more important than reshoring, according to the High Value Manufacturing Catapult (HVM Catapult).

HVM Catapult, an initiative to promote high value manufacturing in the UK via a network of research and development centres, highlighted the evidence that a complex mix of factors is keeping manufacturing in the UK, bucking the trend of previous decades.

It cites examples such as aero-engine maker Rolls-Royce’s decision to develop two production facilities in Rotherham and Washington, Tyne & Wear rather than heading overseas. It had developed ground-breaking technology improvements in collaboration with HVM Catapult.

French luxury group Chanel has invested heavily in its factory in Hawick, Scotland, making it the firm’s global knitwear production centre despite higher labour costs. This is due to the specific knowledge of knitwear design and weaving techniques the site had built up over decades of wool-weaving.

Polyphotonix, which develops organic light emitting diode treatment for people with diabetic retinopathy, had expected to manufacture its special masks overseas due to the costs of development, according to HVM Catapult.

But the firm decided to keep manufacturing in the UK because of the combination of research facilities provided by the Centre for Process Innovation in Wilton, and research grants from the Technology Strategy Board and NHS.

Janet Godsell, professor of operations and supply chain strategy at Warwick Manufacturing Group, one of the HVM Catapult’s seven centres, said:

“One global consumer packaged goods company chose to consolidate its single global supply chain hub in the UK, despite other options, because of the depth of supply chain planning skills its Southampton operation had developed. Britain needs to better understand its place in the global value networks of global companies to exploit the full breadth of its supply chain capability more strategically.”

A white paper, that includes a survey on the drivers for reshoring in the UK, will be launched at the National Manufacturing Debate at Cranfield University in Bedfordshire on 20 May.

HVM Catapult chief executive Dick Elsy, who is speaking at the event, said ahead of its publication, that reshoring was an important phenomenon boosting UK manufacturing.

“Keeping manufacturing in the UK in the first place, however, is even more significant for the growth and success of our economy,” he said. “Many global companies are not only deciding to keep production here but deliberately want to increase the British component of their end products, such as Jaguar Land Rover in the Midlands for example. 

"Smaller companies need to know how to competitively produce their goods in this country, and how to exploit this recent tendency to develop local suppliers.”

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