Growth is back: igus primed for strong forecasted manufacturing recovery

Member News

A popular quarterly
manufacturing outlook shows strong output recovery, UK orders and new
investment plans across industrial sectors. igus UK is matching and exceeding
these numbers, and has many solutions to support the recovery, as Managing
Director Matthew Aldridge explains.

For many 2022 was a recovery
year, but heavily thwarted by supply chain disruption. Many companies
struggled; orders were there but the essential parts needed to make them were
not. Also after the furlough scheme and pandemic-relayed government measures were
discontinued, there was a big increase in insolvencies. Entering 2023, it
seemed that many people working in manufacturing looked forward to the year
with a mixture of excitement and trepidation.

The numbers are positive. Make UK
and BDO have published the 2023 Q1 Manufacturing
that makes interesting, and encouraging, reading. It says
that the domestic market continues to outperform expectations, and margins are
forecast to be up again next quarter. Output volumes are increasing as supply
chain disruption is, finally, easing. Deeper into the report, other figures are
exciting; output is up by 21%, UK orders up by 20%, export orders up by 12%,
investment plans up by 14%, overall business confidence up by 6.5%. Admittedly
this follows a period when all measures had fallen since Q2/Q3 2001.

This strong recovery supports
what we see at igus. Lack of space when orders rebound is also a factor driving
more frequent orders. Space is at a premium at many engineering companies, and
we are seeing customers order what they need when they need it. This leads to a
greater number of smaller orders, and there is an increasing trend to place
these online.

The igus web shop is now the
first port-of-call for many customers, probably because it is easy to use and
gives so much information quickly. Full pricing is visible and there are no
minimum orders. Even large OEM customers are using the web shop now. As well as
being easy to place orders, the e-commerce platform also allows igus to quickly
process more orders than ever before, meaning higher volumes in faster
turnaround times. This helps to explain why the growth in orders received in
the igus UK web shop is well in excess of the overall industry growth figures
given in the Make UK report.

Look to low-cost automation
when cash and labour in short supply

The battle to improve
productivity – both in manufacturing and in the UK economy – continues, and it is
no surprise to read that investment in manufacturing is up by 14%. Here igus
has another novel solution. The new platform
allows engineers to plan, configure and cost a complete automation or robotics
system online. The focus is low-cost automation and self-build. With total
costs for systems starting at just £5,000 this allows companies to implement
simple but effective automation in UK factories – and also other
non-manufacturing businesses, like science labs and retail vending systems. The
low price point encourages investment and explains why this area of automation is
proving extremely popular. Over the next quarter and beyond we expect that many
more UK companies will use to invest in automating their factories.

We’ve recruited apprentices to future-proof the business

There is a severe labour shortage in most industries, and as the Make UK report highlights; more early retirement and an exodus for health reasons has made it more acute. At igus we are finding it very difficult to recruit the skills we need for expansion, but actually this is nothing new.

Over five years ago, I anticipated this shortage, seeing what was happening in the political and social landscape. To future-proof our business, we launched the igus UK apprenticeship scheme, and have rolled this out to all areas of the business. igus now has a steady stream of home-grown talent developing right through the company, and former apprentices are now performing key roles. Initially we tried working with our local college, but we did not get the results that we needed. Igus now uses several proven online training centres and are working with universities for our higher level apprenticeships.

Centrally located in Northampton, igus is at the heart of manufacturing and engineering – geographically and as a key supplier. Investment in training, stock, technology and people means that igus can solve real supply chain problems for companies. The result is that orders are often turned around in 24-hours, and investment in logistics means next day delivery to most UK companies. All igus employees who have contact with customers are trained to use the latest digital communication tools, and therefore support for design, engineering, production, purchasing, logistics and finance are all available at the click of a button.

The Make UK Q1 Manufacturing Outlook describes precisely what we are seeing “on the ground”, and igus is perfectly placed to support UK manufacturing through the rest of 2023 as it recovers and prospers.