Editor
The Engineer
The iconic UK folding bike maker Brompton is a curious company. Though exports account for around 75 per cent of its output, it continues to manufacture all of its bikes in the UK. And not just any part of the UK, but in leafy Chiswick, spiritual home of the urban SUV and top of the range baby buggy, and just about as far removed from a UK industrial heartland as it’s possible to get.
Following this week’s announcement that the firm had a received a prestigious Queen’s award for export achievement, its Managing Director Will Butler-Adams mounted a compelling defence of a manufacturing strategy that appears to fly in face of the currently accepted wisdom
Asked on Radio 4’s Today Programme whether he was planning to follow other entrepreneurial UK success stories and outsource manufacturing to a low-labour cost economy, he confirmed that Brompton is here to stay. This is not – he stressed – because of some quaint attachment to the eccentric idea of manufacturing in the nation’s capital but for the simple reason that if the firm was to outsource manufacturing it would find it very difficult to protect its IP. Armed with the precise knowledge of how to manufacture its bikes, third party engineers in China for instance, would, he said, be free to take their skills to rival businesses. The advantage of manufacturing in Chiswick, he quipped, is that there are no neighbouring manufacturing businesses.
Many companies that have outsourced their manufacturing – Dyson springs to mind – would disagree vehemently with the notion that it’s impossible to protect your IP if you’re manufacturing overseas, and indeed Dyson polices its brand extremely effectively. But Butler-Adams’ comments might give other manufacturers – who’ve been tripped up by China’s lax patent laws – pause for thought.
Of course, the radio musings of a bicycle manufacturer are unlikely to cause a sea change in the UK manufacturing industry. But there’s also another force at work.
As the middle class of so-called low labour cost economies grows, labour costs rise. And this is exactly what’s currently happening in China. A reduction of the financial incentives of outsourcing manufacturing, coupled with the inevitable concerns over IP, might indeed point to a future where firms like Brompton are no longer a lone curiosity.
In the meantime – if you fancy a demonstration of British engineering ingenuity at its best, next time you see someone riding one of the iconic folders ask them how quickly they can pack it away. They won’t be able to resist giving you a quick demonstration. I should know.
Jon Excell
Editor
The Engineer
(Current best folding time: 10.43 seconds)
Isn’t it the Americans that have the saying, “what goes around comes around”?
Money is the manufacturer’s god but some of those outsourcing their products in other countries are already finding that the work force are making more financial demands. The Indians are one of the nations who are demanding better salaries than before.
Well done to Brompton and I hope other companies follow suit and remain in Britain.
I for one are glad Brompton state that they are here to manufacture their bikes in England. The concept of the bike is brilliant (and yes I do own and ride one). As long as they make bikes here then wealth is put back into the local economy without much of it going abroad and local people are employed. Surly we cannot grumple at that!
So you didn’t hear the excellent “In Business” programme on Radio 4 the week before that was all about the Brompton Bike Company and its way of doing business?
While we’re talking R4, did anyone else hear the excellent Engineer Joke on Balham Bash last night? Check it out on Listen Again.
The most excellent output of Fuller’s Brewery might well be a significant advantage of manufacturing in Chiswick. A nice pint of ESB at lunch time – Ahhh!
Speaking as the Product Manager for Carbolite, the UKs largest manufacturer of laboratory furnaces, as well as furnaces and ovens for industrial applications, based in the heart of the Derbyshire Peak District National Park, I can assure you that there are still parts of British manufacturing that are strong healthy and thriving.
Good products, an innovative approach and good exports built over many years have stood us in good stead, but so also has the UKs own home grown engieering base.
We have a factory in China- It makes our stuff for Asia Pacific that takes too long to ship from here. When it comes to cost, we make it cheaper here in the UK than they do in China anyway.
I would contend that the reason they can survive in London that they are manufacturing a premium priced product in comparatively low volumes. Good marketing! It is a soundly engineered and well designed product which is essential for this model to work.
Well done and here is to continued future success.
It’s not just the cost of labour that is increasing. The cost of transporting goods is also rising. There is also concern about the quality of goods, some of which is appalling. You wait three weeks for a boat full of products to arrive only to find that it’s all rubbish. So you re-order and wait another three weeks. Alternatively, you can air freight, by which time, the financial benefits have vanished. The problem for the UK is that we are losing the skills to support a manufacturing boom.
A while ago that Brompton did do some initial feasibility studies in switching production to outside the UK. But the quality of some of the precision engineered components was not good enough for them, or so the article stated.
I am also glad that they are staying not just in London but in the south east…I worked for a large scale manufacturer in Hemel Hempstead which subsequently ceased to exist. Let’s hope it is a change in the future and that the UK stops ‘hemorrhaging’ jobs in favour of the bottom line. Bring back engineering apprenticeships, decent pay for blue collar workers and start making those coming through education look away for the perceived lure of cash in the City, to the development of skill and a rewarding job in engineering and manufacturing. Let us not forget the revolution which happened in that Coalbrookdale iron foundry in 1709! Maybe a different piece of ‘push iron’ will lead us to another industrial revolution.
This happens only because of ‘a premium priced product in comparatively low volumes’. To make UK back to the top of manufacturing/engineering, you just cannot do it in such way.
Sorry to say…. I do not see anything encouraging from this business.
Moving productoin overseas using cheaper resource has hidden costs onshore. In order to maintain quality one has to invest heavily onshore. In the software world we struggle terribly with poor quality from overseas developers – and not necessarilly because they’re bad but because we’re not good at managing them.
Only an estate agent or maybe a journalist would claim Brompton Cycles is in Chiswick, it’s in Brentford! In fact at the bottom of the Great West Road which has a long history of manufacturing though now sadly declined.
From cyclist, engineer and proud Brentford resident.
As a Yank I find it amusing that some onw from the UK would think that making specialty, high price, low volume products is not the way forward.
The UK is famous for being the land of motor sports experts (almost all the formula 1 teams are UK based and engineered). Rolls Royce (as in jet engines) also comes to mind.
Germany is another example of a country where they make a lot of specialized products that are not high volume.
As for the US? As Milton Friedman, the Economist, once said “We are only 20 years behind the UK”.
Ron
It is another success story for the UK, workers employed instead of unemployed, and a large proportion of their products exported for vital export revenue.
These are the sort of so called “non-orthodox” industries whick need promoting here in the UK. Industries which offer quality and fly in the face of industry recognised operations; and succeed.
A well designed product with continuos improvement and built in features survives competition. One has to reduce actual number of men deployed to produce it along with knowledge of workforce. Absolute knowledge or wisdom of manufacturing despite paying higher labour wages is cheaper.
We make Sintering Furnaces in India for last 33years. Our cumulative knowledge base has virtually stopped any imports of Sintering furnaces in to India. Despite our small size we have one of the lowest Kw/Kg ratio of Sintered products for our clients. We have thwarted imports from China Korea Japan Germany USA and many other countries.
With our experience we have also got some novel ideas implemented in our furnaces. Softwares are our strong points and local resources have given us best softwares to monitor process precisely with complete recording and analysis. This makes Malhotra Engineers a well known Sintering Furnace manufacturer.
Survival is partly due to devotion to business and researched product development. A copy cat has no longterm standing and is bound to fail sometime. In recession times no copycat has survived. They are only fairweather friends.
Lets hope that this anouncement starts a chain reaction. Whilst China does fill a chink in the lower regions of the market we in the UK should aim higher. Saddle’s and bikes may seem to at the bottom end but we in the UK are not in the bottom bracket of manufacturing. We must strive to keep the wheels of industry turning. So fork out and buy British. Crank up spending on UK produce.
While we are talking about outsourcing manufacturing – let’s talk about outsourcing servicing too. Am I alone in feeling utterly disheartened by call centre operatives speaking on a broken digital line from the other side of the world? This is not only in B2C but entering into B2B world too. Customer service is about building trust and to do that the customer has to believe the other person cares. Sorry, but these people are not part of my community so I cannot believe they care about me. Companies that service from the Uk get my vote every time. Lets start bringing that back too.
Brampton’s turnover is around £10m. There are half a dozen dutch manufacturers each shipping 10 times more bikes than Brampton. The Brampton business model suits the socially divided Britain where nobody now has the will to, nor expectation that we can, make anything non-trivial that’s useful for the masses. Another typical example is formula 1 where too many good engineers and technicians are “brain-drained” into something as industrially irrelevant as motor racing! Consequently there’s next to no manufacturing skill developement opportunities for the plebs, which is the platform of any real and stable economy!
Outsourcing manufacture results in the outsourcing the skills, knowledge and expertise in engineering. Over the past 40 years this has been a large contributor to closing our trade gap. We have allowed this to happen in favour of quick profits. Surely it is time we had a pln for a more balanced economy where we value a sensible mix of outsourcing and insourcing.
I come from India and used work for one of the strong manufacturing companies, with British and American collaboration. I certainly find the Brompton case as auguring well for the British manufacturing industry. However, this applies only to precision engineered low or medium volume manufacturing. There are beneifts to eb derived from outsourcing of manufacture to India or China. It is certainly a serious concern that a good pecentage of outsourced manufacture has resulted in significant loss of ultimate quality (I have to admit despite my great respect some of the engineering companies in my own country). I wish a great many British manufacturers emulate Brompton and bring back the magic of Engliech quality to engineered products. Wll the very best Brompton.
In the USA we now pay premium price for standard quality. So much production has been outsourced to CHINA it is hard to find domestic items at any price.
From a friend in Hangzhou: he has a Brompton bike. They were useful when they lived on a canal boat. He has also ridden a Brompton with an electric motor.
… the price of Chinese bikes. In Carrefours supermarket, Hangzhou, a folding bike was £30.
I know of a street furnature company who used to source from China and Poland but for the last few years have brought the manufacture back to the UK because it’s cheaper to make them here.
a thought to the tens of thousands of school leavers who would normally have went into these manufacturing industries which have moved to other continents who are no longer given the oppertunity to develop and learn not just technical skills but life skills
I asked in a shop in Singapore why one signal generator was twice the price of the other, when apart from the name, Kenwood on one and Flash bang on the other, they seemed identical.
This one made during the day….
This one made at night…
This is a great story and I believe a lesson for all who transfer their production offshore.
There is an example, in the model railway arena. Both Bachman and Hornby namufacture in China but Dapol – N Wales – makes its models in UK and its prices are competitive. Is there a lack of manufacturing expertise or perhaps longer term vision in the two companies who use China?
There is a lesson here.
After 1945 much manufacturing moved to Japan and Singapore that has now moved on to China and Korea. But as the standard of living in those two countries improves is there another country with a supply of good “cheap labour”? I believe not.
I think UK and Australia, to name just two, will deeply regret their emasculation of industry and their movement to one sided economies dominated by a single product.
Peter Clark’s comment about Dapol manufacturing in N Wales prompted me to check as I though different.
From their web site, hidden in the FAQs is the following:
Q) Where are your products produced?
A) All our tooling is done in China, as are our chassis under contract. However body moulding and painting and final assembly is done at our Chirk factory.
I cannot help but feel that the central point is being missed. In my personal opinion the sourcing of manufacture should be constantly under review. This process should take in not only manufacturing and shipment costs but also potential extensions in development due to the distance of the manufacturer. It is a lot easier to explain and review product manufacture with someone in your own factory, or just down the road than it is with someone in China. Inertia through investment in tooling and the consolidation of established working relationships is inevitable but a global economy means that no-one should decide on a particular path and stick to it come what may. This, of course, does not mean that I do not hope to see a resurgence in manufacturing in Britain.
There are many hidden costs and other environmental consequences of using cheap labor in China. If a household, business or country pays out more money then it takes in; it eventually runs out of money. If your country already has a trade defect with China, importing more product and increasing the defect just accelerates the process. If you lay off workers in your country and hire workers from China the result is few workers in China and fewer workers in your own country will be able to afford your products. The workers in China are not paying taxes to cover the cost of unemployment benefits and health care costs for the unemployed in your country. Business in China, the USA and most European countries have stricter environmental protection, minimum wage laws and energy standards then China. Why is it OK to impose these laws on business in your country then let allow business that pay slave wages, create more pollution and waste more energy import their products and undercut the price of domestic suppliers.
If people in California think that it is good to impose government regulations on business that manufacture product in California isn’t it logical that the same rules should apply to all business that sell their products in California. Also, if manufacturing business in California have to pay for and pass USDA, EPA, OSHA, CARB, and FDA inspections, isn’t it logical that off shore business that sell their stuff here should do the same. We can’t go to the Chinese government and force them to reduce pollution but we can say to business that, “if you don’t clean up your act we won’t buy your stuff”.
I’m sure that some of your readers, slave owners from pre-civil war cotton plantations, those who evade taxes and exploit illegal aliens will disagree. The truth is that if business want people to buy their products, they need to have customers that are paid enough to afford them.
very true, but we are stuck in a downward spiral; wage increases = move manufacturing abroad = cheaper goods of inferior standards = purchased by out of work manufacturing personnel as opposed to quality graded EU goods= more manufacturing moving abroad etc. etc.
We should regulate the quality of goods imported, or levy a fee on the importers for non compliance of standards. this would in turn return manufacturing, jobs and a better quality of goods.
As for Brompton, very good product in a niche market selling low volumes. long may they continue to fly the flag.
Not really “premium priced”, check the apparent competition, they aren’t much cheaper except the really junk ones. It’s only practical to make a product of this quality, and durability, in the UK under the supervision of the designer, Andrew Ritchie. Outsourcers invariably try to “improve” the product or cheapen it and, all too frequently, copy it. I do comment, perhaps not impartially, having owned Bromptons for around 25 years, my original model is still going strong. I also admit to being a shareholder but I bought the first Brompton well before becoming one. Life would be significantly less fun without one.
Interesting – The Brompton bike although folding small is getting a bit outdated – and seems to refuse to join the 21st century. Its only concession to style over utility is Colour – ‘pink for girls/ ‘ type of style rather than Apple style. Its not that making a bicycle has to look like a bit of victorian engineering, as the electric Gocycle (also a UK success story) shows. Its a choice that Brompton seems to make, like Morgan cars refuse to modernise, and prefer to appeal to 50 somethings (typically with beards and elbow patches).
I would love to see brompton re-engineered for the 21st century, keeping its legendary folding geometry, but with a more up to date appeal of said Gocycle. Colour changes can only go so far to modernising a product and the label ‘classic’ might keep the traditionalists happy, but lack of real innovation will eventually ossify the company.
Maybe the 2 companies Brompton and Gocycle could even share facilities and marketing – but I doulbt that would ever happen as I get the impression that both companies are the extension of their owners personal wants and needs.