SPECIAL REPORT: Corona Virus & Manufacturing

  15/06/2020

With so much media attention surrounding the subject of PPE, many in the manufacturing and supply chain industries are questioning whether we started to reduce our dependence on overseas suppliers for items that protect our keyworkers.

Some are taking things a stage further, and calling for a second industrial revolution in order to bolster the flagging economy and ensure that the essential items we take for granted every day are always within our reach.

This hot topic has been further fuelled by the fact that coronavirus originated in China, meaning that major production lines in one of the world’s largest manufacturing heartlands ground to a halt for several weeks. This had a knock-on effect elsewhere, with even big brands like Apple saying that their own operations were affected due to a lack of parts coming from Asia.

Its no secret that China has long been a manufacturing powerhouse due to the low cost of labour, streamlined production processes and excellent infrastructure. With the ability to produce items quickly and cheaply, it made perfect business sense for many organisations to outsource production to China.

However, in light of the COVID-19 pandemic that continues to rage on, many are putting availability and the British economy over that of profitability and questioning if our reliance on Chinese goods is justified.

As British manufacturers, we champion excellent quality products, produced here at home, but if many manufacturers (and consumers for that matter) are willing to follow through on their plans for reinvigorating UK manufacturing and buy British, what are the hurdles they’d have to overcome to make this a reality?

Supplier Infrastructure

Establishing a new supply chain or manufacturing hub is heavily reliant on the infrastructure that’s in place to support it.

In some cases, it is cheaper to ship out a product to have it assembled elsewhere, and then return it to its original place of origin for sale. This means relying on foreign labour and infrastructure, which although more cost-effective, doesn’t cut down on delivery timescales.

Many UK businesses and consumers are calling on the UK government to provide financial incentives to manufactures to produce raw materials and assemble products here in the UK and have the companies that supply components located close by.

Logistics Investment

China has a plethora of seaports, roads and trains, all of which help to transport exports all over the globe and bring in raw materials quickly from every continent.

Should the widespread manufacturing of goods come home to the UK, more investment will need to be ploughed into the improvement of these essential transport links.

Many British manufactures find that their logistics needs are well met here in the UK, but should manufacturing explode and our reliance on China dwindle as we choose to buy British, then more warehousing, better road links and larger seaports will be required for exports.

Inspections and the labour force

Many goods that come from overseas are often delayed due to red tape and inspections. With British manufacturing, this is minimised, meaning that goods are available on shelves in a much shorter timescale.

Proof of this is the Government’s request for clothing manufacturers such as Barbour to transform their operations and step in to create hospital gowns at short notice. Once raw materials had been sourced and machines and processes set up, the production lines started in a matter of days.

Although the costs of production may be higher due to the disparity in salaries and other operational expenses, many will argue that the extra cost is justified.There is perhaps no right answer to this debate and it’s worth noting that China was able to send supplies to several nations including Italy in their moment of need. What is clear is that the impact of coronavirus has highlighted once again just how important it is to have a robust, healthy manufacturing industry at home in the UK, staffed by a skilled labour force and served by world-leading infrastructure

Posted by Ross Gard    |    15/06/2020    |    Industry Focus, Industry Reports, PPE