Manufacturers are taking production back in house and looking for local supply capability in response to increased supply chain disruption cause by recession and natural disasters.
That’s the conclusion of a survey by the EEF, the UK manufacturers’ organisation. It found that 82 per cent of companies have seen supply chains disrupted by recession – and two fifths of companies have seen a major supplier fail. The most significant impacts on companies from disruptions were loss of orders and loss of revenue.
One third of the companies surveyed said supply chain risk was now regarded as board critical.
The EEF believes that this is an opportunity to build manufacturing capacity in the UK and reverse some of the hollowing out of supply chains seen in past few decades.
Clearly, the EEF as a manufacturing organisation, has an interest in seeing more manufacturing in take place in the UK. Chief economist Lee Hopley, says: “We need to capitalise on this opportunity by removing obstacles for manufacturers looking to expand capacity or diversify into new areas and, by creating a business environment that pulls in every pound of vital investment to our economy.”
What is clear is that there has been a shift in attitude – perhaps it’s time to dust off the old adage “Think global, act local”.