British firms must spend to stay ahead
Competitiveness is a key priority for British businesses, with more than four in five looking to invest to improve efficiency and productivity. This is according to the latest Attitudes to Business Investment survey from Lombard, the UK’s largest asset finance provider. The research reveals:
- 82% of respondents are looking to invest to improve efficiency
- 71% say that investment plays a key part in improving levels of productivity, rising to 78% of manufacturers
- 62% said the impact of new technology would increase efficiency, nearly half (45%) said it would improve overall competitiveness while a quarter (25%) of manufacturers believe that it would drive exports
- 57% of all businesses and four in five manufacturers (80%) are planning to invest to support export in 2016
- For a third (33%) of manufacturers, export will be the main area of investment in 2016
- There was an acknowledgement of the need for Government support, with 70% of manufacturers saying that they would like to see more done to encourage export activity, particularly when it comes to cutting red tape
Ian Isaac, Head of Lombard, said: “It’s very encouraging that UK businesses and manufacturers in particular are taking an enterprising approach to the importance of investing to secure their place in the competitive global arena.
“The findings of the survey indicate that UK businesses are very aware of what they need to do in order to secure ongoing and sustainable growth. Within their business plans, investment aimed at securing innovation, improving productivity and establishing strong export markets will continue to play a fundamental role in the future health of the UK economy.”
The Attitudes to Business Investment survey is in very much in tune with what EEF The Manufacturer's Organisation has found from its members.
Lee Hopley, Chief Economist at EEF, the Manufacturers’ Organisation, commented: “It’s the worst-kept secret that the UK has a big productivity challenge. We’ve lost a lot of ground since the financial crisis, but the UK has some real potential strength in its industrial sector, which historically has a good track record in delivering productivity gains. The need for a laser-like focus on driving through efficiency improvements, innovating and investing in new technologies is central to the business model of manufacturers, a fact confirmed in this new research. While we see lots of concrete steps being taken by manufacturers to grow and be competitive in a challenging economic climate, the job is never done.
“To get manufacturing growth and productivity on a stronger trajectory we want to see more companies investing in major technological advances, a strong commitment to industrial strategy from government and finance providers working in partnership with industry to make investment plans a reality.”
Alby Pattison is Managing Director of Hartlepool-based Hart Biologicals, a successful medical science manufacturer that exports 80% of its products. Pattison said: “Lombard’s research finding that manufacturers are investing to support export matches our own experience. We’ve invested over £500,000 to date which has ensured that we are able to support new orders coming in and we’ll continue to expand our capacity to secure new export contracts.”
Isaac concluded: “The survey demonstrates that many UK businesses recognise that investment in innovation is needed to drive competitiveness and efficiency. These businesses are taking the positive steps needed to equip themselves to operate within the demands of the global marketplace. However, it will be vital that more businesses adopt the strategy of ongoing investment so that the UK continues to move forward.”