While they are wary of the threat to their competitiveness posed by China and the US, more than half think the UK is a more competitive place to operate than it was last year. Meanwhile, around a third think the UK is increasing its competitiveness against Germany and France, and a similar number think we are moving ahead of Spain and Italy.
Though they see risks in access to skills, increasing energy and employment costs - and remain wary of economic conditions both at home and abroad - the majority think opportunities will outweigh risks. The survey shows there is cautious optimism in the air as we enter 2024. Over the next 12 months, key areas of focus for manufacturers include investing in new products and upskilling or retaining their people, as well as expanding into new markets, accelerating net zero commitments and investing in digital technologies, such as cloud and artificial intelligence (AI).
“After what has been a rocky few years for manufacturers, there is cautious optimism in the air. Though the to-do list likely looms large for many, as economic headwinds, geopolitical instability, steep employment and energy costs continue, the horizon seems brighter.”
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Priorities for manufacturers in 2024
New products and processes
Topping the list of opportunities reported by manufacturers is expanding their product portfolios. Manufacturers are the driving force behind innovation and R&D, constantly pushing the boundaries and revolutionising products, especially as we transition towards a more digital and green economy.
Merger and acquisition activity can play a vital role in driving innovation and new market readiness in accelerated timeframes. There are also clear benefits for firms that invest in data and digital technologies to evolve and support the development of products and services.
Companies can benefit from the opportunities of achieving net zero by: Developing new or improved methods of manufacturing; increasing energy efficiency for the business; producing sustainable products; and delivery services. Such improvements can lead to increased efficiency, better quality and reduced costs, which, in turn, can increase productivity and resilience while also reducing their carbon footprint.
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Source: Make UK Executive Survey 2024
New markets
Manufacturers have their eyes on the prize when it comes to tapping into new international markets and exporting their goods and services across the globe. Some 27% of companies see major opportunities with new international markets, and almost a quarter (23%) see opportunities to export to new countries.
With the UK/India trade deal due to be signed imminently, and the UK/Comprehensive and Progressive Agreement for Trans-Pacific Partnership agreed in the last year, manufacturers are grabbing exporting opportunities with both hands. Although the EU remains the top choice for manufacturers, our research indicates that geographical proximity, cultural similarities and now, wider trade considerations, continue to dictate trade relations for many UK manufacturers and their exporting choices. As Manufacturers strive to work in new markets, they will need to be proactive in navigating changing UK trading rules and regulations as a result of our exit from the European Union.
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Source: Make UK Executive Survey 2024
New digital technology
Manufacturing businesses are investing in digital technologies more than ever before and reaping multiple benefits, including increased productivity, improved products, reduced waste, and labour efficiencies. Advanced technologies and digital tools such as robotics, cloud, data analytics, and AI can automate business processes, including finance, human resources, manufacturing and procurement, resulting in increased productivity.
For example, our recent EMEA Cloud Survey shows that for the Industrial Manufacturing sector, 80% of all respondents have either started implementing or have adopted cloud in many parts of their business. The survey found that cloud tech increased productivity for 36% of respondents - the second most measurable value created after enhanced customer service at 37%.
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Source: Make UK Executive Survey 2024
Contact us
UK Leader of Industry for Industrials & Services, Manufacturing and Automotive lead, Private Business leader for PwC Northern Ireland, M&A Deals Partner, PwC United Kingdom
Tel: +44 (0)7809 551517
