How are manufacturers funding their automation investments?

Posted on 17 May 2017 by Jonny Williamson

The Annual Manufacturing Report 2017 shone a spotlight on what funding options UK manufacturers prefer to use when funding their investments in automation.

How are manufacturers funding automation investmentsAs the graph above clearly shows, the financing of investment in automation is largely being done by manufacturers themselves.

Responses to the question were very revealing, and are very much in accord with recent findings by EEF and other such bodies, namely that that the majority of companies are using their own cash reserves (63%) or asset finance (20%).

Slightly fewer than 10% of the respondents made use of equity funding or external grants for funding, and slightly more than 7% took out a bank loan. That’s compelling evidence that the sector, in common with the rest of the economy, has yet to return fully to normal following the recession of 2008/09.

If UK manufacturers are doing everything in their power to avoid using banks, but storing up cash on their balance sheets against rainy day investment needs, then they aren’t going to be spending money elsewhere, or increasing wage levels.

The extent to which banks are decreasingly seen as a vital participant in business investment decision-making is concerning, with an obvious need for greater communication and engagement between the financial sector and the nation’s makers.

You can download the full Annual Manufacturing Report 2017 here.

The Manufacturer Smart Factory Expo

Nov 15-16, 2017 – Exhibition Centre Liverpool

The UK’s biggest showcase for the Fourth Industrial Revolution (4IR) – a revolution in manufacturng agility, innovation and thinking.

Highlighting the best solution providers and technology offerings, this unique FREE event is for manufacturing business leaders keen to adopt the relevant tools and knowledge to drive business growth.

New for 2017:

  • Buyer Lounges – matching buyers and sellers
  • Tech Zones – Industrial IoT, Automation & Robotics, Additive Manufacturing, Digital Transformation, and Big Data
  • Solution Theatres – engaging expo attendees with case studies and cutting-edge developments
  • Mentor Clinics – find the answers to your questions
  • Innovation Alley – growing the expo ecosystem with hardware start-ups