Findings from the latest Manufacturing Advisory Service (MAS) Barometer show that England’s SMEs are investing in their businesses to further stimulate growth.
Half of the 682 companies questioned expect to spend more on new machinery and premises over the next six months, a 12 per cent rise on the same period last year.
According to the report, a similar appetite exists for adopting new technologies with 40 per cent of firms indicating they will fund more activity in this area.
Just over half (53 per cent) of SME manufacturers reported an increase in sales in the first half of the year, with 67 per cent predicting further growth over the next six months.
In a statement, David Caddle, area director for the Manufacturing Advisory Service, said, ‘Manufacturers tend to be very cautious and traditionally would have needed significant confidence in the long-term future to relax the purse strings.
‘Encouragingly, the latest Barometer provides the clearest indication yet that companies are prepared to invest in new machinery and their premises in a bid to remain competitive and take advantage of significant opportunities both at home and abroad. It is a reassuring finding and appears to meet the EEF’s recent call for the sector to fund more research, innovation and export growth.”
This sense of optimism is also present when it comes to employing new staff with 43 per cent of SMEs planning to hire new staff and a further 50 per cent expecting to keep workforce levels the same. “
The second MAS Barometer of 2013 collected responses from 682 manufacturing SMEs across England, providing an overview of economic conditions and issues faced by the sector from April to June this year.
The regular quarterly special focus concentrated on finding out whether business growth could be linked to innovation.
A total of 82 per cent of respondents reported that new products introduced over the last two years had led to new sales,with 55 per cent reporting an increase in sales and profits. Over a third of respondents said that new sales accounted for 25 per cent or more of their total turnover.
The Barometer also revealed the diverse requirements of the automotive, defence and food and drink sector are being fulfilled by the majority of respondents. Marine, aerospace and oil and gas are also generating strong demand.
· Half of the 682 firms questioned are planning to invest in new machinery and premises
· 67 per cent are predicting future increases in sales turnover – highest recorded since survey began
· 82 per cent of firms have gained new sales as a result of introducing new products or services in the past two years