BQ Manufacturing in the Midlands special report

BUSINESS QUARTER MIDLANDS: Manufacturing Special Feature

Manufacturing in the Midlands From research and development, tax relief and growth to productivity and automotive, we take a look at Midlands manufacturing

BQ Manufacturing Bind In.indd 1

22/03/2018 09:38

ad_ambitious-insider-magazine.pdf

1

05/03/2018

13:15

Understanding ambitious businesses GrowthLine facilities are helping Ludgate Finance's clients thrive:

A profitable electronics manufacturer needed a flexible solution to their growing working capital requirement.

Ludgate Finance introduced the deal to Growth Street, and the approval process gave the business a quick resolution. The firm's directors are now able to invest in additional stock and plan for its next phase of growth with a £700k GrowthLine.

"We've found the team at Growth Street to be flexible, capable, and willing to take time to understand our clients.

They are our go-to lender for clients needing a bespoke working capital solution.”

Steve Grice - Director, Ludgate Finance.

Contact Midlands BDM Richard Steele: richard.steele@growth street.co.uk 0808 123 1231

BQ Manufacturing Bind In.indd 2

Copyright Growth Street Exchange Limited. All rights reserved. Growth Street Exchange Limited is registered in the UK, company number 09495712. Growth Street Exchange Limited is an Appointed Representative of Resolution Compliance Limited, which is authorised and regulated by the Financial Conduct Authority (no. 574048)

22/03/2018 09:38

03

bqlive.co.uk

WELCOME MANUFACTURING IN THE MIDLANDS

CONTENTS 10. RESEARCH AND DEVELOP AND PAY LESS TAX Jumpstart explains how not to miss out on R&D tax relief.

14. SOLVING OUR PRODUCTIVITY PUZZLE Productivity improvement is a key factor for economic growth.

16. POWERING MANUFACTURING Growth Streets Growth Line delivers the funds businesses need.

20. A LOOK UNDER THE BONNET WMG maufacturing chairman examines the near automotive sector deal.

THE manufacturing sector has long been synonymous in the Midlands as a major driver of regional economic growth. As the birthplace of the Industrial Revolution, the region has moved on from the early days of metalworking and small arms manufacture to become a centre for automotive and manufacturing excellence.

As a key part of the UK Government’s growth strategy, manufacturing supports a skilled workforce across a wide variety of sectors including automotive, precision engineering and food and drink, as well as in emerging global industries such as low-carbon vehicles.

UK manufacturing is seeing its strongest growth for some time, boosting hopes of a strengthening economic recovery and the Midlands is playing a major role in this upsurge. At this critical time, we must maintain the momentum and ensure that the sector is fully supported to embrace opportunity and extend trading momentum.

The manufacturing, automotive and the supply chain sectors are the lifeblood of the Midlands economy and, within this supplement, BQ will be taking an informed look at the challenges that lie ahead for the region’s manufacturing businesses and also the opportunities that could arise from the rise of “Industry 4.0”.

This includes the UK Government’s first Automotive Sector Deal, which aims to build on the unique strengths of the nation’s automotive sector and further develop the strong collaborative partnership established between government and industry. Lord Kumar Bhattacharyya, chairman and founder of the WMG manufacturing research centre, explains what it means for the region’s businesses.

We also hear from Tim Lake of leading law firm DLA Piper, who explains how manufacturers can best prepare themselves for Industry 4.0 and R&D tax specialist Wendy Smith explains how businesses can use government support to invest in new processes and technologies to ensure they stay ahead of the pack.

And whilst we look to the future, there is no escaping the loom of Brexit and the uncertainty the cloud has cast over industry. Dave Atkinson, UK head of manufacturing at Lloyds Bank, explains how the result of the referendum has affected currency fluctuations and how it has benefited exporters to the detriment of importers.

All in all, there is change ahead and there will undoubtedly be uncertainty surrounding it. However, through this issue, we hope to uncover how such challenges are being overcome and shed some light on what the future looks like as we head into the fourth industrial revolution.

Bryce Wilcock, editor

In association with

Business Quarter is part of BE Group, the UK’s market leading business improvement specialists. www.be-group.co.uk

BQ, Spectrum 6, Spectrum Business Park, Seaham, SR7 7TT. www.bqlive.co.uk. As a dedicated supporter of entrepreneurship, BQ is making a real and tangible contribution to local, regional and national economic growth across the UK. We are unique in what we aim to achieve as a media brand, a brand that has established a loyal audience of high growth SMEs and leading business influencers. They wholeheartedly believe in BQ’s focus on people – those individuals that are challenging the traditional ways of doing things. They are our entrepreneurs. BQ reaches entrepreneurs and senior business executives across Scotland, the North East and Cumbria, the North West, Yorkshire, the Midlands, Wales, London and the South, in-print, online and through branded events. All contents copyright © 2018 BQ. All rights reserved. While every effort is made to ensure accuracy, no responsibility can be accepted for inaccuracies, howsoever caused. No liability can be accepted for illustrations, photographs, artwork or advertising materials while in transmission or with the publisher or their agents. All content in this BQ should be regarded as advertorial.

All information is correct at time of going to print, March 2018.

BQ Manufacturing Bind In.indd 3

22/03/2018 09:38

04

bqlive.co.uk

Manufacturers find reasons to be cheerful Manufacturers in the Midlands have every reason to be optimistic about the year ahead, says Dave Atkinson, UK head of manufacturing at Lloyds Bank.

He tells Bryce Wilcock why now is as good a time as ever to go for growth.

G

rowth hungry manufacturers in the West Midlands should take note of Dave Atkinson’s name. As Lloyds Bank’s UK head of manufacturing he has helped facilitate in excess of £4bn worth of financial support to British manufacturers over the past four years.

And as the UK looks forward to postBrexit Britain, there has never been a better time for manufacturers to go for growth.

The falling value of the pound has proved a major boon for exporters, in turn, order books are swelling.

“We’ve seen a buoyant trend and mood over the past few months across the manufacturing sector,” Atkinson says. “We’ve seen order books grow as optimism continues to rise and we’re seeing businesses who would have never thought about exporting now capitalising on overseas opportunities due to the weakening of the pound.

“We’ve also seen confidence rise after the UK’s decision to leave the European Union (EU), which initially created mass uncertainty amongst all sectors. However, having worked with manufacturers for 30 years now, the one thing I’ve noticed is their amazing agility when faced with uncertainty.

BQ Manufacturing Bind In.indd 4

“Regardless of where the uncertainty originates from, they knuckle down, and they find a way to deal with it. Uncertainty is a big part of a small or medium-sezed enterprise’s (SMEs) growth. It’s a challenging world out there and they are faced with challenges every day of the week.

“I think they’ve just knuckled down and said, ‘you know what, we recognise there’s an opportunity here, we recognise there’s an opportunity if we invest and we recognise there’s an opportunity to create new jobs.’

“The sector has done that really well and a third of manufacturing firms who participated in our latest Business in Britain report said they were looking to step up investment this year and around a quarter were looking to create jobs.”

But, whilst Atkinson and his team are enthused about the growth potential following Britain’s decision to withdraw from the EU, he is also acutely aware of the challenges that manufacturers face.

He says: “Whenever there is a movement in currency markets there are winners and losers. For those who are importers of their raw materials, they’ll face the challenges of increasing costs. Another challenge is the ongoing uncertainty surrounding

the decision to leave the EU, which will naturally impact some more than others.”

However, as head of manufacturing, Atkinson’s remit isn’t just to help provide financial support to manufacturers, but to build relationships and work with industry bodies to help drive growth across the sector.

A great example of this is the Advanced Manufacturing Training Centre (AMTC) in Coventry, which has been designed to help plug the skills gap by providing premium training for the next generation of engineers and technicians in the Midlands.

Joining the Department for Business, Energy & Industrial Strategy, Lloyds Bank is the largest private sector contributor to the centre and is contributing £5m over a fiveyear period as part of its commitment to support the UK manufacturing industry and to help tackle the sector’s shortfall in skills.

As Atkinson explains: “While the sector has indicated a determination to create more jobs this year, there is still a national skills challenge. We’ve recognised that and it was one of the big prompts for us as a business to invest £5m to support 1,000 apprentices, graduates and engineers through the AMTC.” The bank is also investing in helping

22/03/2018 09:38

05

bqlive.co.uk

“

“If you look at the broader picture, the Midlands epitomises the manufacturing sector. It supports highly skilled jobs and contributes massively to UK exports.”

businesses make more of their working capital having published its latest working capital index, a unique barometer of working capital pressures on British businesses.

Although the index doesn’t specifically delve into how each individual sector is affected, Atkinson was keen to reiterate the benefits of manufacturers exploring practical ways they could make a difference to the way they manage working capital.

“The index shows there is £535bn of additional cash tied up in working capital across British businesses,” he adds. “What has caused that? The fall of the pound was one of the key reasons as many businesses imported raw materials in bulk to save themselves from paying more in the future and have stockpiled materials in turn.

“Secondly, you naturally get a draw of cash into working capital when you go through a growth phase, which the wider sector has enjoyed over the past seven or eight months, leading to growing order

BQ Manufacturing Bind In.indd 5

books. One in four businesses also stated they’re experiencing longer times to pay, in other words the people paying them are taking longer to pay up. Add all of that together and there is £535bn of additional cash tied up in inventory, extended payment terms and red tape. All of the things that affect a business’ cash flow.”

Lloyds Bank made a commitment to provide £4bn worth of new lending to the manufacturing sector over the four years to the end of 2017. By the end of June last year, six months early, the bank had delivered that goal.

Now, as the bank drafts up its investment plans for the next four years, Atkinson believes manufacturers in the Midlands in particular have a great opportunity to realise their growth potential.

“If you look at the broader picture, the Midlands epitomises the manufacturing sector,” he says. “It supports highlyskilled jobs and contributes massively to UK exports. In fact, almost half of all

UK’s exports come from manufacturing businesses.

“That’s why we invest in the sector and our overarching ambition is about helping Britain prosper, which is why we have a strategy built around that and the businesses and the people in the communities in which we work.

“That’s why we’re investing in skills through the AMTC, investing £4bn into manufacturing and have dedicated teams who have been trained through University of Warwick to help businesses grow. We want to be the bank of choice for manufacturers and there are lots of ways through both our financial and non-financial solutions we can help manufacturers.

“So, if you’re a manufacturer and are thinking of scaling up your operations, connecting with industry, or simply want support, be it financial or not, come and talk to us, we’re always looking to support manufacturers and help them grow.” n

22/03/2018 09:38

06

bqlive.co.uk

Dispelling the myths of the Fourth Industrial Revolution Tim Lake, partner at leading law firm DLA Piper, looks at the opportunities set to arise from the rise of Industry 4.0.

W

hether you call it Industry 4.0, the Fourth Industrial Revolution, or 4ir, the changing face of the manufacturing sector may have coined a few different names, but the concept remains the same.

There has never been a more exciting time to be involved in UK manufacturing.

Technologies are changing almost every aspect of our day-to-day lives and industry is no different.

From automation to three-dimensional (3D) printing, artificial intelligence through to virtual reality, technology is transforming the sector at an alarming rate. And whilst most global manufacturers have been quick to embrace the change, many small or mediumsized enterprise (SME) manufacturers are still getting to grips with the concept.

“The march of new technologies and industry 4.0 is set to have a huge impact on the manufacturing sector over the next 12 months,” Tim Lake, partner at DLA Piper, tells BQ. “Manufacturers really need to understand that if they don’t embrace industry 4.0 to a degree, then they risk being

BQ Manufacturing Bind In.indd 6

left behind.”

Lake is very keen to emphasise the fact that there are various degrees of embracing new technologies and that, contrary to popular belief, it doesn’t necessarily have to cost the world for manufacturers to embrace new technology and processes.

“I think there needs to be more done in terms of dispelling the myths surrounding Industry 4.0 and explaining what the term really means,” he adds. “We have already mentioned three different names associated with the concept and I think that is contributing to the confusion that exists among manufacturers at the moment. Companies are confused about what Industry 4.0 means, when in truth, it is relatively simplistic in terms of the theory behind it.

“We need to do more to educate manufacturers, mainly SMEs, to enable them to understand how Industry 4.0 can help them with their existing business structure, their existing footprint, systems, technologies and equipment.

“We also need to recognise that a lot of machinery out there is relatively old, and that Industry 4.0 isn’t necessarily about disposing all of this existing kit and bringing in a whole load of new sexy machines that are internet enabled. There are many systems out there that can be retro-fitted to old machinery, so in terms of the capital outlay, it isn’t as great as what a lot of smaller manufacturers think it is.

“Another barrier is the idea that it would

cost an awful lot to become fully connected and get the full benefit of 4.0 when in actual fact that isn’t the case. It goes back to the comment I made earlier that there are degrees of embracement of 4.0, it’s not that you necessarily have to go out there and spend an awful lot of capital to make use of it. There are a whole host of specialist financial companies springing up around the edges now which are particularly focused on helping businesses reap the benefits of 4.0.”

Another concern that is often aired when people talk about Industry 4.0 is automation and the impact it could potentially have on staff. A common myth is that automation will ultimately spell the end for the line worker. However, whilst it will have some impact, it may not necessarily be as big a threat as many fear, as Lake points out: “I think there is a genuine fear and distrust that the advent of new technology will naturally displace jobs from the shop floor and the hard truth is that is probably right.

“However, the technology we’re talking about here still requires human input and human operation. I think it’s a case of helping employers to understand that, whilst embracing 4.0, employers will still have to upskill their existing staff in order to get the full benefit of new technology.”

Another benefit to arise from embracing Industry 4.0, alongside the upskilling of staff, is an increase in productivity and output levels. “Ultimately the theory behind all of this is that it’s a constant march and drive towards improving efficiency, productivity

22/03/2018 09:38

07

bqlive.co.uk

“

“We have businesses on our doorstep that are market leaders and I think there needs to be a recognition that the quality produced by those manufacturers needs to be sustained.”

and quality,” he says.

“I think one of the things we forget about, especially in the UK and the Midlands in particular, is just where we are in terms of manufacturing. We’re a world leader. We have businesses on our doorstep that are market leaders and I think there needs to be a recognition that the quality produced by those manufacturers needs to be sustained.

“4.0 and the technologies that we’ve mentioned are all designed to help businesses play a part in continuing to innovate and stay ahead of the game and compete on a world stage without turning to, or at least implementing in part, some of those technologies. The danger is that if we don’t, we risk being left behind.”

As a traditional law firm, DLA Piper specialises in the core business sectors and has a heavy focus on manufacturing.

BQ Manufacturing Bind In.indd 7

This has seen Lake and his team work with companies from across the supply chain from major original equipment manufacturers (OEMs) to tier four component makers. So, what advice would he give to companies looking to embrace Industry 4.0?

He concludes: “Manufacturers should embrace Industry 4.0 wholeheartedly but also recognise that it doesn’t necessarily have to result in a huge capital outlay. It’s about making sure that, by embracing it, you do so in a considered manner and not necessarily by throwing the old out and replacing it with the new. I think there has to be a recognition of the role that 4.0 has to play alongside existing processes and equipment.

“The outlook amongst the region’s manufacturers is pretty positive and all

of the indications are that manufacturers are going to have a better year than they did last, which means many companies will be looking to invest and upscale their operations.

“So, if you require support, we can help from a legal perspective, but I think the real value is helping our clients understand the journey they need to go on and letting them have the benefit of the mass-degree of research and knowledge we have from helping companies across the supply chain.” n For more information please contact: Tim Lake, Partner

T +44 (0)121 262 5934 F +44 (0)121 262 5794 M +44 (0)7971 142 217 E tim.lake@dlapiper.com W: www.dlapiper.com

22/03/2018 09:38

08

Profile

Manufacturing firms at greater risk of criminal liability?

The face of corporate criminal liability in the UK is changing. DLA Piper’s Laura Ford offers an insight into managing the risks.

Laura Ford Legal Director T +44()(207 1537058 M +44(0(7971 142238 E laura.Ford@dlapiper.com W: www.dlapiper.com

BQ Manufacturing Bind In.indd 8

The face of corporate criminal liability in the UK is changing. Typically, prosecutors have to prove that the most senior individuals in the business were involved in offending in order for liability to bite the company itself. With a new raft of criminal offences now focussing on a company’s failure to prevent crimes being committed, however, the number of companies being pursued in relation to serious criminal conduct is on the rise.

Failing to prevent bribery has been a criminal offence since 2011. The UK saw four disposals in relation to that offence within an 18 month between 2015 and 2017 (three by way of deferred prosecution agreement and one by way of prosecution). By contrast, the Serious Fraud Office successfully prosecuted just four companies in the entire period 2000 to 2014.

The success of the “failing to prevent bribery offence” appears to have been a driving factor in the UK Government’s consideration of whether to introduce a much broader offence of the failure to prevent economic crime, which would cover crimes such as fraud, false accounting and money laundering. The government consultation on that offence ran until 31 March 2017 and the jury is still out as to when – or whether – it will become law.

In the meantime, a new corporate criminal offence of failing to prevent the facilitation of domestic and foreign tax evasion has been brought into force. We are now six months on from its inception, and many businesses, including those in the manufacturing sector, are still grappling with how to respond to it.

It is a defence to both of the current failure to prevent offences to have in place adequate or reasonable procedures designed to prevent commission of the offence. For any business with more than a minimal risk of committing bribery or the facilitation of tax evasion, such procedures will involve: completion of a risk assessment; drafting of policies and procedures to meet the specific risks identified; training for at-risk individuals; regular communication

“

“The number of companies being pursued in relation to serious criminal conduct is on the rise.”

from the board and other senior management on the importance of compliance; and regular monitoring and review of the effectiveness of the procedures.

Manufacturing businesses can be at particular risk in relation to both bribery and facilitation of tax evasion offences. They often engage in large, complex transactions; they operate overseas and with foreign supply chains; they supply to governments, or in connection with government contracts and often engage agents to act on their behalf in dealings with customers or other third parties. Such businesses would be well placed, therefore, to commit a proportionate amount of resource to managing these risks and ensuring the existence of a defence, should that ever be required.

The key driver behind this sea change in the approach to corporate criminal liability is a desire by the government to put the onus back on businesses to ensure they operate in an honest and ethical manner. There has been a significant increase in the focus on internal compliance programmes since these offences came into effect, which can only serve to improve the reputation of businesses operating in the UK. The first contested trial in which a company’s compliance procedures were used as a defence to bribery charges took place recently; that defence failed. The question still remains, then, for all those trying to stay on the right side of the law, as to what their procedures would need to look like in order to ground a successful defence. n

22/03/2018 09:38

INVESTING IN THE FUTURE....

There is no doubt that technology is revolutionising the manufacturing sector. Over the next 5 years manufacturers in every industry will have invested billions in advanced digital technology, from 3D printing to smart-machines.

DLA Piper is perfectly positioned to advise businesses in the manufacturing sector. We have unparalleled experience and insight into this global industry and act for a diverse range of manufacturing clients across various sub-sectors, from multi-national organisations to regional firms leading the way with innovative new technology.

Through our global network we can seamlessly deliver the industry know-how and commercial advice to help you succeed, wherever in the world you operate.

DLA Piper – Supporting business in the Midlands and wherever the Midlands does business.

Tim Lake Midlands Manufacturing Lead Partner T +44 (0)121 262 5934 tim.lake@dlapiper.com MAR18 | 3291888

BQ Manufacturing Bind In.indd 9

22/03/2018 09:38

10

bqlive.co.uk

R&D doesn’t have to be taxing Wendy Smith, business development manager for Jumpstart in the West Midlands, talks to BQ about research and development (R&D), oiling the Midlands engine and why industry is still missing out on millions of pounds of R&D tax relief.

How has the appetite for R&D tax relief changed in recent years?

We are seeing a major increase on the ground, with a lot more companies now considering whether they are eligible or not and looking for someone to guide them through the intricate web R&D tax relief can be.

This is what our 13 technical analysts, who work across the UK, are telling us every day and this is backed up by figures from HM Revenue and Customs (HMRC). The most recent data (for the year ending March 2016) shows an overall rise in the number of claims (26,255) and the benefit realised by companies (£2.9bn). These are up 19% and 20% respectively.

If we look at the regional figures for the Midlands, we find that the number of claims, and the value being claimed, is relatively lower than would be expected. Given that manufacturing companies receive 32% of the total benefit in the UK, and given the importance of manufacturing in the Midlands, it’s a little disappointing to see that

BQ Manufacturing Bind In.indd 10

overall the region only receives 13% of the total benefit.

What have been some of the major changes for claiming R&D tax relief and how will these develop in 2018?

Possibly the most significant trend is the

increasing number of claims that are being disputed by HMRC, with leading law firm Pinsent Masons quoting that this has increased in value from £90m to £425m in just 12 months.

It doesn’t take a rocket scientist to work out that the government is becoming a lot more vigilant in assessing claims and in policing the scheme in general and this is something we welcome.

There is a lot of money at stake and it can make a major difference to the companies that are rightfully submitting an application.

It will also help to address the significant number of R&D tax relief providers that are entering the marketplace, many of whom don’t have the same level of experience or expertise as more established organisations.

Some of them can just see the opportunity to make a “quick buck”.

The rise in the value of disputed claims by HMRC makes it all the more important that manufacturers thinking of claiming choose a specialist, like Jumpstart, that focuses on robust defensible claims and offers “free enquiry” defence as standard on every claim it prepares and submits.

22/03/2018 09:38

11

bqlive.co.uk

Finally, we have also seen a change in emphasis within the engineering and manufacturing sectors toward claims for activities undertaken within process innovation projects.

Do you feel more Midlands companies are switching on to the benefits of applying for R&D tax relief?

Again, the statistics suggest Midlands companies are switching on to the benefits of the scheme faster than companies across the UK as a whole.

While the number of local firms claiming has grown roughly in line with the UK average, the value being claimed in this region has grown a whopping 26% between 2015 and 2016 (compared with 20% nationally).

If we could match that growth over the next three years, we could easily add a further £300m to the Midlands economy.

However, there is a “but” coming. This increase in the number of claims being submitted doesn’t mean manufacturers are maximising the full value of benefit available to them. Our technical analysts are still finding a significant number of inaccurate claims amongst companies preparing their own claims and those of other providers.

BQ Manufacturing Bind In.indd 11

Choosing a specialist with a track record in maximising the value of benefit within a robust defensible claim is key for unlocking the region’s “innovative” potential.

What are the challenges you are faced with in getting companies involved in this scheme?

This is an easy one and one that has been around for as long as R&D tax relief has been offered.

The biggest challenge is ensuring companies – regardless of whether they make fasteners for aerospace, produce food ingredients or develop new batteries for electric vehicles – recognise that a lot of what they do qualifies for relief.

Many believe R&D is just about creating new products or bringing a new technology to market. That is not the case, it’s more about doing things differently to achieve a competitive advantage, cost saving or just to help your business run that little bit better.

Take the earlier point of R&D within process innovation projects for example.

Many manufacturers believe that technical challenges faced on a day-to-day basis simply wouldn’t qualify under the scheme’s criteria.

This is definitely not the case. As long as the projects are looking to achieve an appreciable advance in their field of technology and there are technical uncertainties to be addressed, then there’s a good chance the companies can make a claim.

Our advice for busy firms would be to pick up the phone and get an expert to go through your claim with you. They will very quickly tell you if you’ve got a claim to take forward.

Jumpstart has recently opened an office in Birmingham. What were the reasons behind that decision?

The Midlands is rich in manufacturing expertise, especially across automotive, aerospace, food, rail and renewables. These are sectors containing lots of firms that thrive on innovation and doing things differently, so are in a perfect position to claim significant R&D tax relief.

With that in mind, it made perfect sense to open an office in Birmingham, giving us a real presence on the ground and a base from which to grow our market share in this area.

This is only our second location outside of our headquarters in Scotland so shows

22/03/2018 09:38

est results, time after time.

12

bqlive.co.uk

tax credit consultation and potential returns you might t the Jumpstart team: how committed we are to supporting the Midlands manufacturing base.

If we can help the region be as effective at claiming its R&D tax relief as its counterparts in London and the South East of England, we estimate it could bring in between £47m and £64m every year. That’s a lot of cash for reinvestment in new equipment, plant and, importantly, jobs.

Jumpstart is keen to help drive the Midlands Engine and to ensure it maintains its competitive edge through innovation.

Increased productivity equals increased wealth.

artuk.co.uk

@jumpstartuk.co.uk

26

How have the first eight months been?

We are really pleased with the response from industry in the region, with about 50 clients

added to our existing 100-strong Midlands portfolio.

Importantly, having a presence in the area has helped us forge new partnerships with key organisations like the EEF, National Defence Industries and Rolls-Royce Control Systems supplier development programme.

If you could advise the government on future changes to the R&D tax relief scheme, that would benefit companies in the Midlands, what would you ask for?

Jumpstart would ask the government to continue to focus on making this scheme more attractive to small and medium-sized entreprises (SMEs). This is the part of the economy where the majority of innovation happens in the UK and it’s important that we

provide as much encouragement as we can to this segment of the marketplace.

We also feel that it would be a wise move to focus on encouraging innovation in the key areas identified in the government’s Industrial Strategy by enhancing benefits for R&D in priority fields of technology and science.

There could also be greater enhancements for R&D activities in technologies identified as being critical to the UK’s future competitiveness by agencies including Innovate UK and UK Research & Innovation. n

pstart your R&D tax credit claims

R&D tax relief support helps Copper Alloys forge ahead with £1m sales boost A North Staffordshire manufacturer has won £1m of new orders thanks to its commitment to delivering complex forgings and machined components.

Copper Alloys has secured a string of contracts over the past eighteen months with customers in the aerospace, defence, marine and petrochemical sectors.

This expansion has been supported by Jumpstart, that has worked with the company to generate more than £100,000 of R&D tax relief over the past three years… all of which has been directed into the development of new alloys for applications as diverse as ice cream machines and nuclear submarines.

“Current managing director John Dudley started the business in 2000 as a continuous casting firm, but the management team quickly realised they needed to differentiate themselves from rivals,” comments Ivan Richardson, technical

BQ Manufacturing Bind In.indd 12

manager at Copper Alloys.

“We are always striving for innovation and trying to push new metal technology to the next level…this has been crucial in delivering the £1m of new business wins.”

Copper Alloys, which holds AS9100 and ISO 9001 quality accreditations, started to explore ways in which Government funding could support its expansion in 2013.

However, after being weighed down by paperwork and failing to meet certain criteria for European funding, the company decided to take a different route and enlisted the support of Jumpstart to see if it qualified for tax relief for its R&D work.

This proved to be a wise move with the two parties quickly forging a strong working

relationship and, to date, more than £100,000 has been returned to the firm.

Ivan adds: “You hear a lot of bad tales about R&D tax relief; the amount of time it takes and not getting the best results.

“This couldn’t be further from the truth with Jumpstart. We were immediately assigned a technical analyst in John Thomson, whose strong industrial experience meant he could get to grips with what we were doing and then develop a report that met the needs of HMRC. “It was relatively quick, easy to do and we managed to get a significant amount of money back from projects that had created a new lead-free alloy for use in an ice cream machine and a new alloy that is developed for periscopes in nuclear submarines.”

22/03/2018 09:38

Uncover the Uncover the HIDDEN CASH

HIDDEN CASH just waiting just waiting to be discovered to be discovered in your business in your business

Jumpstart, the UK’s leading R&D tax relief specialist, is on a mission to help Jumpstart, the UK’s leading R&D tax manufacturing companies in the relief specialist, is on a mission to help Midlands claim the £millions in R&D tax manufacturing companies in the relief they’re entitled to.

Midlands claim the £millions in R&D tax relief they’re entitled to.

The key is to identify as much eligible expenditure as you can. The more you The key is to identify as much eligible identify, the greater the value of the expenditure as you can. The more you relief you’ll receive from HMRC. identify, the greater the value of the relief you’ll receive from HMRC.

For a free R&D tax relief consultation and analysis of the potential returns you might For a free R&D tax consultation expect, contact therelief Jumpstart team: and analysis of the potential returns you might expect, contact the Jumpstart team: www.jumpstartuk.co.uk helpinghand@jumpstartuk.co.uk www.jumpstartuk.co.uk 0370 218 7751 helpinghand@jumpstartuk.co.uk 0370 218 7751

Jumpstart your R&D tax relief claims Jumpstart your R&D tax relief claims BQ Manufacturing Bind In.indd 13

22/03/2018 09:38

14

bqlive.co.uk

Supporting Midlands manufacturers

Economic Growth Solutions managing director Martin Coats says increasing productivity is one of the key factors in helping the UK economy grow sustainably.

The UK Government has, for some years, targeted improved productivity and competitiveness performance. It’s productivity framework identifies five drivers that interact to underlie long-term productivity performance: investment, innovation, skills, enterprise and competition. Policies that have been designed to increase productivity are often targeted at these drivers. However, to determine the success, the accurate measurement of productivity is vital.

Part of the UK’s recent poor labour productivity performance has been that low wage growth has increased the attractiveness of employment for companies. This was a major factor causing employment to hold up well during the downturn and to since pick up markedly. It has helped companies to hold onto workers, retaining their experience and knowledge.

Given the uncertain economic and political outlook, some businesses may also be trying

BQ Manufacturing Bind In.indd 14

to meet demand by taking on labour rather than commit to investment. The relatively low cost of labour relative to capital certainly supports employment over investment.

The UKs productivity puzzle is the unexplained disparity between the UK’s economic performance improving and its labour productivity per hour worked falling and is also a source of much debate and analysis. The mystery is a popular topic for media, politicians and economic commentators and it’s not difficult to see why.

Business Secretary Greg Clark launched the Government’s ambitious Industrial Strategy last November, setting out a longterm vision for how Britain can build on its economic strengths, address its productivity performance, embrace technological change and support businesses and workers.

An “industrial strategy” is traditionally understood as a set of government

interventions that seek to support or develop specific industries – especially manufacturing.

However, current usage of the term is much broader. Industrial strategy in recent times has been more about coordinating a wide range of economic policies to achieve objectives, which need not be purely economic. For example, an industrial strategy can have social and environmental aims.

It becomes clear, that at the whole economy level the UK faces a substantial productivity gap – both compared to competitors and its pre-crisis trend. However, the picture becomes less clear when looking at how different sectors of the economy have performed.

Official statistics indicate that the manufacturing sector’s productivity growth outperforms both that of the services sector and the economy, both before and after the recession. This suggests that manufacturing is not at the centre of the UK’s weak

22/03/2018 09:38

15

bqlive.co.uk

“

“The Manufacturing Growth Programme, delivered by EGS, has now supported over 2,000 ambitious manufacturing companies to make improvements, become more productive and ultimately to grow.”

productivity performance.

Economic Growth Solutions (EGS), deliverer of the Manufacturing Growth Programme, supports the government’s longterm plan to boost the productivity and earning power of people throughout the UK and the Industrial Strategy moves us in the right direction.

Martin Coats, managing director at Economic Growth Solutions, says: “Increasing productivity is one of the key factors in helping the UK economy grow sustainably.

The Manufacturing Growth Programme, delivered by EGS, has now supported over 2,000 ambitious manufacturing companies to make improvements, become more productive and ultimately to grow.

“We will be delivering productivity improvements to a further 1,200 companies over the coming months which will support the aims of the British Government”.

It is important that the economy focuses on both our existing and emerging strengths and invest in the technologies and capabilities that will generate opportunities domestically and across the world.

The government’s plan to make additional financial resources available to Local Enterprise Partnerships that demonstrate ambitious levels of reform is also a fantastic opportunity to identify, understand and remove barriers to growth for small and medium-sized enterprise (SME) manufacturers.

Recent Manufacturing Barometer surveys, delivered by SWMAS (part of the Excellin Group) in partnership with Economic Growth Solutions, focused on the term ‘productivity’ with the aim to delve deeper into the productivity puzzle and what it really means to manufacturers.

The Manufacturing Barometer is the largest survey conducted of SME manufacturers in the UK and asks senior decision makers for their views on factors influencing business performance and the future of the sector.

Questioning more than 320 senior decision makers of SME manufacturing businesses across the country provides strong clues as to why manufacturers are bucking the trend and, more importantly, how they are doing it.

The overriding feeling from the report is one of optimism, with 70% of businesses expecting sales to increase over the next six

BQ Manufacturing Bind In.indd 15

months – the highest recorded since quarter two 2015.

They believe that economic growth will be achieved alongside increased employment, with 48% predicting a rise in staff numbers.

Over half (56%) of the SMEs we surveyed expect to increase their investment in machinery and premises. By committing to investment, manufacturers are encouraging innovation in new product development and resource for more efficient processes.

Manufacturing has proved relatively buoyant in recent years despite economists’ warnings that the UKs productivity continues to lag behind its major trading partners such as the United States, France and Germany.

With the impact of Brexit further underlining the importance of efficiency, the government’s industrial strategy addressing the UKs “productivity puzzle” has increasingly looked to robotics and automation to boost productivity levels.

However, when asked in last quarter’s barometer survey how they would most like to improve productivity, most respondents said they are prioritising smarter working practices and better utilisation of existing equipment over new equipment or automation.

Dean Barnes, regional director of Economic Growth Solutions, adds “This barometer delved deeper into how manufacturers are tackling the productivity puzzle and it’s hugely positive to see that more respondents are planning to invest in machinery and premises, and around half are committed to recruiting staff.

“However, with well over two thirds of manufacturers reporting expected sales growth, it’s clear that unlocking the full potential of the existing workforce remains key to sustainable productivity gains. It is of paramount importance that businesses are able to access specialist help and advice to grow and improve, and fully realise this potential.”

Peter Bruch, managing director of Birmingham-based precision components manufacturer AE Aerospace, concludes: “We have focused on productivity improvements since our management buyout four years ago. The biggest difference has been the investment in our people and systems, the

team understand what work they need to do, why and how it benefits them to improve what we do. The systems we have developed enable work to be planned on machines with people and available in the right place at the right time.”

Over the past 16 months, the Manufacturing Growth Programme has committed £2.6m of tailored manufacturing support to assist businesses in making vital improvements with a view to increase productivity and creating jobs.

Local manufacturing growth managers, who work with ambitious firms to help them overcome barriers to growth, can support management teams to introduce lean manufacturing, improve scheduling, put in better supply chain management controls and secure finance towards vital improvement projects.

This isn’t just a quick fix; you need to take a more holistic approach to improve your company. This includes building a highperformance team, encouraging innovation among your staff and identifying skills for the future.

The positive outlook from SME manufacturers, and their commitment to invest, bodes well for improved productivity.

These same strategies could be just as effective in solving the issue in other sectors, helping to train and develop staff and improve business processes.

Get the balance right and we may just have found the elusive answer to the productivity puzzle. n

Contact Us today manufacturinggrowthprogramme.co.uk 01664 501301 enquries@egs.live Twitter: @MfgGrowthP

22/03/2018 09:38

16

bqlive.co.uk

P wering Midlands manufacturing in 2018

Greg Carter, chief executive of Growth Street, talks to BQ and offers an insight into how his firm can help the region’s SMEs fulfil their potential.

M

idlands manufacturing is at the heart of the UK economy. It powers the engine of the West Midlands and East Midlands with economic output figures of £17.5bn and £15.9bn respectively, building on the towering presence of aerospace and automotive sectors, as well as many others.

Around 323,000 people are employed in the manufacturing industry in the West Midlands and 293,000 in the East Midlands, highlighting the importance of the sector to the region as a whole.

The EEF Manufacturing Outlook

BQ Manufacturing Bind In.indd 16

Survey reported sustained momentum in manufacturing activity in the final quarter of 2017 with 34% of companies reporting an increase in output, a landmark level.

Manufacturing exports are also rising, driven by a global upswing in demand and support from a cheaper pound, with dominant European Union (EU) markets accounting for 47% and 52.3% of all manufactured exports from the West and East Midlands respectively.

According to Sajid Javid, secretary of state for communities and local government

and ministerial vhampion for the Midlands Engine, which looks to make the East and West Midlands an engine for growth for the UK economy: “The Midlands Engine already boasts over 14% of the UK’s high-growth businesses and its economy is worth more than £230bn – larger than countries like Denmark.”

There are also notable infrastructure developments in the Midlands of national and international significance, which are creating a substantial ripple effect, boosting regional supply-chains and the

22/03/2018 09:39

17

bqlive.co.uk

“

“GrowthLine is recognised by Midlands manufacturers as a flexible, innovative funding facility.”

local economy. These include the £50bn HS2 project, as well as the extension to the Midland Metro linking the Black Country to Birmingham city centre and the Birmingham Airport runway extension.

Growth Street to inject £50m into growing Midlands businesses The importance of the Midlands to UK industry has prompted Growth Street, an alternative finance provider for UK small and medium-sized enterprises (SMEs), to announce that it intends to deliver £50m to Midlands businesses over the next 12 months to help them drive their growth potential.

The call to arms from chief executive Greg Carter follows an important landmark for the business. Greg Carter comments: “The Midlands is a UK manufacturing powerhouse, and we want to ensure that SMEs from Birmingham, Coventry, Wolverhampton and beyond are able to fulfil their potential with an investment boost. SMEs in the Midlands face an estimated £360m funding gap, and we are looking to contribute to closing this gap in the coming months.

“We recognise that issues that can challenge any business, such as the rising cost of materials, the continuing need to update machinery to improve productivity and trading fluctuations have the potential

BQ Manufacturing Bind In.indd 17

to create uncertainty. We founded Growth Street to give growing businesses the financial support they need to grow with confidence.

“With Brexit fast approaching, we believe that more than ever businesses need access to flexible finance, which can help mitigate risks as well as allowing fastmoving businesses to take advantage of opportunities.

“At Growth Street, we’re on a mission to not only give businesses access to finance, but to provide the tools that will help take growing manufacturers in the Midlands to the next level. This move should in turn inject significant liquidity into the local economy and could boost industry sectors and job prospects.”

The increasing use of accounting software, and secure data sharing via the cloud, allows Growth Street to better manage risk, while also simplifying administration and providing insights to businesses.

Greater Birmingham Chamber of Commerce chief executive Paul Faulkner comments: “We are delighted that Growth Street is planning to make this substantial investment in SMEs around the Midlands region over the next 12 months.

“Not only is it a further sign of business confidence across the Midlands, it reinforces the region’s status as a

powerhouse for start-ups and SMEs. Initiatives like Growth Street are extremely important to provide local businesses with the tools they need to grow and flourish.”

The people behind the numbers Carter adds: “Our focus is to create long-term relationships with ambitious businesses. We harness cutting-edge technology to facilitate a quick and seamless customer experience. At the same time, though, customers can always pick up the phone and speak to someone with financial know-how who can understand their goals.

“One thing that frustrates businesses about most lenders is that they don’t take the time to understand the business in detail. Every manufacturing business is unique, they all have particular aspects of their business model or their growth plans that a lender really needs to understand and that can only be done through personal interaction.

“It may seem slightly counter-intuitive to talk about an over-dependence on machines in this context, but we have seen a prevalence of algorithmic approaches to finance elsewhere, that have resulted in a lack of human interaction. A personal approach, access to the right people at the right time, local knowledge and a willingness to listen to and understand businesses are

22/03/2018 09:39

18

bqlive.co.uk

all critical to creating the optimal funding solutions. I am therefore delighted to welcome Richard Steele to Growth Street as our business development manager in the Midlands, who brings with him a wealth of business finance experience gained within the region.”

GrowthLine – maintaining manufacturing momentum Steele says: “All too often, manufacturers are faced with having to compromise between the level of funding available and the flexibility of the facility. We don’t believe that this should be the case.

“In our view, no business should be paying over the odds for finance – by borrowing more than they need, for longer than they need it, paying more than they should or being pushed into full ledger invoice finance when they really don’t want or need to.

“That’s why our flagship product, GrowthLine, is used by manufacturers in a variety of scenarios, both tactically and strategically: to fund new contracts, smooth over cyclical or seasonal cash flow, make investments in new plant and stock and upskill teams as well as embarking on acquisitions and buy outs. Unsurprisingly, with this level of versatility, GrowthLine is recognised by Midlands manufacturers as a flexible, innovative funding facility.”

GrowthLine is a revolving line of credit that allows businesses to access up to £1m as and when they need it. Once a limit is agreed, customers have the flexibility to draw down funds and make repayments as often as they like, much like a conventional overdraft.

The limits themselves are based on the size of the borrowing company’s working capital assets, such as unpaid invoices and stock. This means GrowthLine limits can grow alongside the customer’s business, potentially giving owners greater confidence in being able to plan ahead. When business owners don’t need additional headroom, they can simply pay back – without ever having to pay for funds they are not using.

Steele continues: “GrowthLine is a revolving

BQ Manufacturing Bind In.indd 18

credit facility, so there are often fewer administrative requirements than invoice finance agreements. This frees up borrowing businesses to focus on what matters: their customers.

“Since we look at the entire working capital position, we are potentially able to provide manufacturers with a balanced facility that reflects the strength of the business. We have a simple process, our pricing is transparent, and we are able to complete transactions quickly and easily.

Our service is designed to work for the long term.

How GrowthLine is powering success for Midlands-based manufacturers The EEF’s Manufacturing Outlook for the fourth quarter of 2017 observed that “manufacturers have been more focused on capitalising on the improving global economic demand picture than the domestic political challenges that continue to dominate the headlines.”

Commenting on the report, Carter says: “The conclusion from the Manufacturing Outlook report mirrors our experience at Growth Street. We live in a news environment where there’s a lot of pessimism about the UK economy and manufacturing. I really believe the media consensus is a lot more pessimistic than the reality, particularly when you look at the manufacturing industry, which has been able to thrive since the UK voted to leave the EU.” He continues: “One of the things we often find with manufacturing businesses is that they are looking to access funding to invest in plant and machinery to drive productivity improvements.

I was talking to a secondgeneration cardboard box manufacturing business recently,

which is looking to borrow a significant amount of money to improve its operations and allow it to unlock a 50% increase in turnover over the coming year.

This is a business struggling to get access to the capital it needs to expand and drive productivity growth. It’s a common challenge.

“We also recognise that with regular payment obligations falling due for wages, suppliers, raw materials and energy costs, as well as plant and machinery maintenance, there are inevitable pressures on working capital for any manufacturing business.

However, as a business grows, inevitably so does the extent of the funding gap.

“A number of manufacturing businesses that joined us in 2017 have used GrowthLine to extend their capacity through investing in stock and other assets, whilst strengthening their working capital positions. Two such companies that have already secured significant competitive advantage in their respective industries through using GrowthLine are a valve manufacturer and a mobile phone recycling specialist.” n

22/03/2018 09:39

19

bqlive.co.uk

GrowthLine generates additional funding for valves manufacturer

Mobile phone recycling specialist makes the right call with GrowthLine

In the manufacturing industry, when your power fails, your organisation fails. A power cut to a facility can have the effect of halting production instantly and could result in a substantial loss of material and unproductive worker time, as well having as a potential impact on the entire supply-chain.

Our first business manufactures valves for heavy industrial machines, principally within the power and energy sector. They could see a fresh market opportunity to expand their stock position as well as investing in industrial power generators to protect their customers against the risks of power outages.

They recognised that in order to fund both their assets and inventory requirements, they would need a complementary funding line to turn the opportunity into reality.

Growth Street’s team met with the senior management team on site and gained a good understanding of the company’s expansion plans. We provided a £100,000 GrowthLine facility to enable the purchase of the new assets and stock. In addition to being able to offer a valuable new service to their customers, the business has since been able to successfully set up a generator warehouse and sell the electricity back to the National Grid, providing a highly – profitable new revenue stream.

Our next business is a mobile phone refurbishing and reselling business, headquartered in Birmingham. The company purchases boxes of returns and repairs for used devices from major retail chains, such as Carphone Warehouse, Tesco Mobile and Vodafone.

The business has expanded its team significantly in the past 12 months. Their technicians test and repair the devices that are subsequently assessed by a quality assurer and the refurbished mobiles are then resold into the retail or wholesale market.

Because of the rapid inventory turnover rate, the business needs to buy just as fast, if not faster, to keep stock levels ahead of demand. Whenever payment terms are extended or where there are opportunities to negotiate early payment discounts, there is heightened pressure on the company’s cash flow.

Following a sustained period of growth, the business approached Growth Street to see how it could smooth over the payment timing lag it was experiencing and bridge the cash flow gap. The Growth Street team took the time to understand the client’s requirements and structured and delivered a £250,000 GrowthLine facility to meet its funding needs.

Crucially, the new funding line has enabled the business to maintain flexibility in its supply-chain, become more proactive with inventory sourcing, secure preferential early payment discounts and minimise stock-outs, as well as avoiding paying high storage costs.

Sector: Industrial valves manufacturer Requirement: Stock purchase Funding package: GrowthLine Value of facility: £100,000

Sector: Electronics recycling Requirement: Cash flow Funding package: GrowthLine Value of facility: £250,000

Supporting growth Greg Carter, chief executive of Growth Street, says: “We are delighted to support both of these fast-growing Midlands-based businesses with a flexible GrowthLine designed to resolve many of the issues they face every day, whilst enabling them to take on substantial new orders. Speed of execution often forms a key component in respect of these transactions and in both of these cases our team reacted at short notice to meet their needs and put the appropriate funding lines in place.

“We hope that these examples have provided a flavour of just some of the ways in which we are helping manufacturers in the Midlands region to grow their businesses safely and securely with facilities that are tailored with precision to match their needs.”

Carter concludes: “We’re real believers in the manufacturing industry at Growth Street, and we’re keen to encourage businesses to approach us if they need support for growth. We want Growth Street to become the first choice for Midlands manufacturing companies looking to grow.”

BQ Manufacturing Bind In.indd 19

For further information, contact Growth Street on: 0808 164 6841 manufacturing@growthstreet.co.uk www.growthstreet.co.uk Growth Street Exchange Limited is registered in the UK, company number 09495712. Growth Street Exchange Limited is an Appointed Representative of Resolution Compliance Limited, which is authorised and regulated by the Financial Conduct Authority (no. 574048).

22/03/2018 09:39

20

bqlive.co.uk

A look under the bonnet Lord Kumar Bhattacharyya, chairman and founder of the WMG manufacturing research centre, part of the University of Warwick, assesses the automotive sector deal between government and industry announced recently by business secretary Greg Clark.

T

he new automotive sector vision outlined by the government has been hailed as a “landmark”.

It focuses around joint investment and long-term commitments between government and industry in areas including the design and development of connected and autonomous vehicles, the research and development of battery technology and accelerating the manufacture of ultra-low and zero emission vehicles.

It builds on much work that has already been done over the years and follows previous and very welcome injections of financial support.

This overview includes:

• Low-carbon automotive technologies – through the WMG-based Advanced Propulsion Centre, the government is investing £500m over 10 years to 2023 to research, develop and industrialise new low-carbon automotive technologies in the UK, with industry providing £500m matched funding for collaborative research and development (R&D) projects.

•

Automotive research and development

BQ Manufacturing Bind In.indd 20

– the government is providing up to £225m from 2023 to 2026 to support R&D in the sector, with industry providing equivalent matched funding.

• Transitioning to ultra-low and zero emission vehicles – the government is putting £246m towards the design, development and manufacture of batteries for the electrification of vehicles.

• Connected autonomous vehicle technology – £250m for development and deployment.

That is the background.

Further, the automotive sector deal announcement committed up to £32m of new joint funding for an industry-led supply chain competitiveness programme plus £26.4m investment, match-funded by industry, in three cutting-edge low carbon vehicle projects involving Ford, GKN and Jaguar Land Rover.

The JLR element will help support the company’s development of electric hybrid vehicle systems – it is in the process of launching a series of electronic versions of

its popular models.

We work closely with JLR and this latest government-industry initiative which follows on from another important development – news that a partnership of WMG, Coventry and Warwickshire Local Enterprise Partnership, and Coventry City Council have been awarded £80m to establish a National Battery Manufacturing Development Facility.

The new national facility will be established in the Coventry and Warwickshire area.

And now WMG can reveal that on the back of the latest government research push we will be building a new centre in the Coventry area for the testing of prototypes.

Why is all of this so urgent?

Things are moving so fast around the world because of environmental problems and pressures – hence the need to switch to electronic and hybrid cars. We haven’t yet solved all the issues around batteries – at WMG we have been working on it for the last 15 years – but what is available now needs to be utilised now.

We are looking at testing autonomous vehicles in Coventry too but autonomous vehicles have a long way to go.

22/03/2018 09:39

21

bqlive.co.uk

Coventry and the sub region has a significant contribution to make in the delivery of the UK’s national Industrial Strategy, being in a strong position to lead the advancement of battery development, and vehicle electrification and autonomous vehicles. It will be at the heart of the drive to become a smart motor city.

Partnership matters, and it is right that I pay tribute to the leadership of business and energy secretary Greg Clark.

He has a “can do” attitude… and his thoughts are on the button.

Clark states: “For decades, the UK’s automotive industry has powered our economy forward. Today, automotive firms from around the world choose to set up shop here, citing our history of excellence, skilled workforce and world-leading supply chains.

“In the next 10 years, the sector will see more change than in the previous hundred.

From the engines that power our cars, to the way we control them and our attitudes to owning them, technology is changing what the industry looks like and where money can be made.

“As a result of the sector deal, both government and industry will invest about a quarter of a billion pounds to develop and manufacture electric vehicles, create a world-leading testing environment for connected and autonomous vehicles and invest in a new industry-led programme to raise the competiveness of UK suppliers to match the best in Europe.

“As we open the automotive sector’s next chapter, we will continue to work with industry to make sure the technologies of tomorrow are developed, tested and manufactured right here in the UK.” I endorse those words wholeheartedly.

Japan, Korea, China and the United States are all striving for success in this area – it is vital we are at the forefront of this revolution.

WMG, Coventry and the UK are indeed at the heart of it all.

We may not be able to match some of our competitors in terms of how much money they can throw at it, but we do have the brains, innovation and resourcefulness to take us a very long way.

This is the future and we must be part of it. n

BQ Manufacturing Bind In.indd 21

“

“For decades, the UK’s automotive industry has powered our economy forward.”

22/03/2018 09:40

22

Profile

Supporting growth in manufacturing By the end of January 2018, more than 1,800 SME manufacturers had benefited from the Manufacturing Growth Programme by receiving more than £2.6m grant contributions.

To find out more call 01664 501301 or visit www.manufacturinggrowthprogramme.co.uk,

BQ Manufacturing Bind In.indd 22

In October 2016, small and medium-sized enterprise (SME) manufacturers were given a major boost through a new £9.7m business support initiative and were looking to support over 3,200 companies across the UK. The Manufacturing Growth Programme (MGP), which is funded by the European Regional Development Fund (ERDF) and delivered by Economic Growth Solutions (EGS), has promised to fill the void left by the Manufacturing Advice Service (MAS) by providing access to specialist assistance to help manufacturers to grow and improve.

By the end of January 2018, more than 1800 SME manufacturers had benefited from the MGP by receiving more than £2.6m grant contributions to help make improvements by identifying, understanding and removing barriers to growth.

Thus, resulting in a boost to the economy by creating over 1,000 jobs with an additional 570 forecasted to be created once open projects have been completed. The MGP has also helped support more than 170 clients create new to firm products developed within the UK. Support received has been given as a direct result of a strategic business review from an 19-strong network of experienced, local, manufacturing growth managers. This review determines what barriers are in the way for their growth potential and what support is needed to overcome those barriers.

Since October 2016, the highest barrier with 15% of clients, has been identified as “Continuous Improvement”, followed by “Environmental” and “Marketing and Market Knowledge” with 12% each. As a result, 24% of clients were given support in “Marketing and Market Knowledge” to enhance and sustain their growth ambitions with a further 15% completing an improvement project on “Business Overview and Strategy”.

With up to 35% grant funding, MGP works with manufacturers and external experts on a range of improvement projects from business Ssrategy and marketing to productivity and leadership and management.

Martin Coats, managing director of Economic Growth Solutions, says: “We have achieved so much in such little time and this could only have been done with the trust and hard work from our dedicated team we have in place. From the field team to the project coordinators in the office, everything has been exceptional and we have received overwhelming feedback from clients, external experts, stakeholders and the industry as a whole.

“The programme has to be delivered by March 2019 so we want companies to come forward and take advantage of this assistance. It’s never been easier as the process is quick and the scope of support can be tailored to meet the exact needs of the business.

“Our aim is to continue delivering business support programmes such as MGP, for the time being our focus is predominantly on MGP as we continue to deliver fantastic results to the UK manufacturing economy”.

Coats concludes: “Industry has withstood a lot of economic turmoil and come through the other side, now we’re here to help maximise the most of new opportunities.”

Shropshire electrical motor firm Motor Design says: “The MGP has been fantastic for accessing funding, which has allowed us to work with experts in business management.

This has enabled us to put a series of measures in place that support the growth and sustainability of our company.”

Leicestershire-based company Adey Steel adds: “We continue to value the support given from MGP and EGS to our evergrowing business. Many thanks especially to our manufacturing growth manager.”

Funding is in place to help over 3,200 firms to tackle operational issues, help support SME manufacturers make the most of new opportunities and to boost the skills of their workforce. n

22/03/2018 09:40

ARE YOU AN SME MANUFACTURER THAT WANTS TO GROW AND BECOME MORE COMPETITIVE? The Manufacturing Growth Programme provides free advice and support with grant opportunities for you to make sustainable business improvements.

Improvement projects we can support you with…

• Lean Manufacturing • Productivity and Capacity • Leadership and Management • Innovation and R&D • Quality Systems • Supply Chain Development • Change • Marketing and Market Knowledge

• Business Overview and Strategy • Customer Relationships • Competitiveness • People and Resource • Environmental • Continuous Improvement • Finance

The programme is currently looking to work with SME Manufacturers in the West Midlands, Yorkshire and Humber, parts of the East Midlands and East of England.

If you are a manufacturing SME, get in contact for a free, no-obligation Manufacturing Strategic Business Review. You will then be guided through the rest of the process by a dedicated Manufacturing Growth Manager (see reverse).

Call today: 01664 501 301

BQ Manufacturing Bind In.indd 23

|

enquiries@egs.live

|

www.manufacturinggrowthprogramme.co.uk

22/03/2018 09:40

“

“UK manufacturing is seeing it’s strongest growth for some time and the Midlands is playing a major role.”

BQ Manufacturing Bind In.indd 24

22/03/2018 09:40