The Manufacturer Magazine : Promoting best practice in Manufacturing

October 2007
Annual Manufacturing Report 2007
Welcome to the sixth Annual Manufacturing Report, the yearly research paper that uncovers the current trends and changes in key issues and factors affecting UK manufacturing across a very broad range of subject matter, including the economy, the role of the Government and its various support agencies, company strategy, finance, purchasing and supply, and information technology.
This year’s research finds UK manufacturers persevering positively in the face of another challenging year for the industry. Despite steadily, if moderately, increasing interest rates, recent turbulence in financial markets, and rising material costs in the second quarter of the year, half of the manufacturers questioned remained broadly optimistic about the UK’s general economic situation.
Manufacturing companies have also continued to invest in key areas of their business, with improvements being made in supply chain management, with nine out of 10 acknowledging that customer and supplier collaboration is an ‘important driving factor’ for new product development, and almost half having made supply chain integration and partner collaboration a key initiative in the last 12 months.
Beyond the main research results, the report also takes an in-depth look at the stories behind some of this year’s findings. While he may have been leading the polls in his first 100 days as Prime Minister, fewer than one in 10 manufacturers felt there’d be any improvement in the fortunes of UK manufacturing under Gordon Brown. Colin Chinery provides a preview of life for UK manufacturing under the new administration, and discovers the extent to which manufacturing is on the new PM’s agenda (page eight).
When it comes to finance, this year’s research shows that manufacturers are less worried about the impact that pension scheme funding will have on the company’s profitability and its ability to compete with overseas competitors. In our finance report, however, Ruari McCallion finds that many manufacturers are worried less
by the rising costs, and more by the legislative burdens associated with company
pension schemes (page 12).
With environmental issues rapidly moving up the corporate agenda (this year’s research shows that manufacturers broadly support the Government’s Climate Change Bill), Debbie Giggle reports on how green supply chain management can also lead to financial savings and improvements in efficiency and competitiveness (page 16).
And finally, with the majority of manufacturers expecting the proportion of raw materials and components they source from abroad to increase, John Dwyer takes a look at how supply chain management software is helping manufacturers to cope in the increasingly complex world of global procurement (page 20).

Victoria Hammond
Editor