Indication of higher confidence

The Manufacturer’s Molly Cooper sat down with Dave Atkinson, SME & Mid Corporates Head of Manufacturing at Lloyds Bank, for an update on what they are currently doing in the sector and what’s ahead for the next year.

Dave currently has two key responsibilities in his role, with the first and main role being that of the UK Head of Manufacturing. “It’s my responsibility to support our teams and business, ensuring we have the right products, proposition, thought leadership and also represent both the industry and Lloyds Bank,” he explained.

His second responsibility is to manage a team of Relationship Managers across the Midlands, Wales and North West looking after manufacturers and a spectrum of small businesses. “We work by their side, in the local communities, with relationship managers and directors to get under the skin of what they need. We provide more than just appropriate banking solutions but consider how we can connect them more widely across the industry,” said Dave.

Providing training opportunities

Lloyds Bank accredits the Relationship Managers through the WMG at the University of Warwick. Throughout the one week training course which is offered, they discuss industry and what it’s really like to be a manufacturing business owner. “It’s a place to understand the challenges they face with supply chains, geopolitical tensions and what happens on the factory floor. They also get to understand the different types of plants and machinery, process flows and bottlenecks.” In turn, this helps Lloyds provide more appropriate and relevant solutions due to the insight into the complex operations of these businesses.

“We also provide advanced sustainability training to our managers through Exeter University; this is an in-depth education programme over many weeks to help them understand some of the challenges that the sector faces from a sustainability point of view,” explained Dave. Due to some of the processes used, manufacturing businesses produce high amounts of carbon emissions from their factories. This leaves them with the challenge to reduce the carbon emissions for themselves and the supply chains that they feed into globally.

“We also offer additional education programmes for our colleagues through a regular CPD programme, which is part of a long-term strategic partnership with the Manufacturing Technology Centre in Coventry. This helps them gain a wider understanding of specific sector challenges and opportunities,” said Dave.

Successful SMEs

Many SMEs work with household name manufacturers within the supply chain, making components or parts for bigger products.

Some examples of successful businesses that have worked with Lloyds are:

• Uhuru Botanicals, a skincare business run by Neo Chatyoka (who recently featured in the Q1 edition of The Manufacturer magazine). She has progressed from making her own skincare products in her kitchen, to a manufacturing plant in Wolverhampton. “Lloyds placed Neo in a development and mentoring programme and now she coaches and mentors’ others to help them create their own formulas,” commented Dave.
• Flora and Curl, a haircare brand based in Birmingham, founded by Rose Ovensehi. “One of Lloyds’ relationship directors is supporting the brand which has just had a huge amount of growth. We’ve just supported them with some working capital to expand further and they are now in over 500 Boots stores across the country,” added Dave.
• Alanto, a rubber product supplier based in the Midlands, has just secured a £3.8m loan. “In order to support growth, they’ve acquired a business called Ramfoam and have been able to expand the production of foam and cut foam products into the Middle East. This is real growth from an export point of view as well as showing diversification.”
• Ecam Engineering, a 55-year-old business in the heavy steel industry, has been supported by Lloyds to decarbonise the business by providing the funding for roof solar panels. “At the same time, they have invested in new plant and machinery that also uses less energy.”

Access to funding

“Manufacturing is so important to the UK economy and is why we invest so heavily to support the sector, the training of managers and the £15m investment at the MTC,” explained Dave. “The manufacturing industry creates close to two and a half million jobs directly. However, when you look at the supply chains that rely on those SME manufacturers, whether they be haulers, logisticians, freight forwarders, security firms, design agencies, banks and accountants, the knock-on effect is huge! A recent report has revealed this to be closer to a total of seven million roles created from the sector.” Manufacturing plants in the UK are also paying around 12% higher than average wages and are also likely to take on more apprentices. “The manufacturing sector is currently contributing massively to the economy when all factors are considered,” he added.

Manufacturers have been faced with many issues in recent years, from increasing interest rates, the journey to net zero challenges, rising energy prices, geopolitical tensions, increased shipping times, but it is great to see many innovative businesses still investing for growth regardless of the challenges they face.

Dave said, “SMEs are taking those big steps, whether it be to acquire other businesses in order to grow, or to invest in new plant and machinery to drive productivity. We are seeing real confidence, regardless of some of the negative data that may be out there.”

Businesses are approaching Lloyds to discuss options for the future of their business, months and years in advance. “We know the manufacturing climate has changed but those within the sector have remained very resilient and agile, which can be seen in the most recent PMI figures, showing some of best readings recently over the last two years.”

The next year in manufacturing

Regarding the upcoming UK election, the industry will be keeping a close eye, but globally, over 40 different counties will be voting in many different elections throughout 2024. Each will have different impacts and bearings depending on where individual manufacturers are importing from or exporting to.

“One thing that manufacturers will have got on their mind is the ongoing shortage of skills. This can be related to maintaining an existing workforce, or the building of a new one to adapt to modern methods of manufacturing,” explained Dave. Lloyds Bank has its long-term sponsorship with the Manufacturing Technology Centre (MTC) where it is investing in the training and upskilling of more than 6,000 manufacturing engineers graduates, and apprentices to help support this challenge.

“I feel proud to work with the SME community, as they are one of the most agile groups that I’ve experienced. When one door closes, they find a key to unlock another, and this will continue,” said Dave.