Savvy UK manufacturing industry outsmarts the recession, PwC report shows
Published: 11 July 2012 - Neil Mead
The UK’s manufacturing industry is outsmarting the recession and the stock market, according to a new report out by PwC.
As other sectors, including the financial sector, struggle to ride the ongoing recession, PwC’s ‘From Crisis to Growth’ report shows that not only has UK Manufacturing Plc’s share price index trebled since 2009, but anyone who had invested would have doubled their money over the past five years.
PwC also found that when recession strikes, companies tend to focus on eight key areas to survive including scenario planning, supply chains, R&D and focusing much more on the customer.
Clive Penwarden, industrial manufacturing partner at PwC, said: “This new research has supported our positive view of how the UK industrial manufacturing sector is performing. We first looked at these companies in 2010 to see what strategies they were implementing to deal with the impact of the recession and found they weren’t just reducing their costs like many sectors in the UK were doing, they saw the financial crisis as an opportunity for growth.
“The businesses we looked at restructured, became agile and flexible and looked to emerging markets for future growth. The strategies they implemented were not only crucial for survival, they have proven to be sustainable. With revenues showing an average year on year growth of nine per cent and 16 per cent in FY10 and FY11, and 2012 looking similarly positive, perhaps other sectors could learn from their success.”
When measured alongside global export growth to emerging markets, the UK still has some way to go to catch up with its peers, but recent financial performance of the UK manufacturing industry suggests it is in strong shape to regain some of this loss.