Earlier in the year we reported on the quarter 2 figures in the regular survey by manufacturing lobby group EEF in partnership with leading accountancy firm BDO. It was interesting to note that UK manufacturing did surprisingly well in April, May and June, despite three months of unhelpful political upheavals and economic uncertainty. As part of that industry sector, designing and making a wide variety of custom metal desks, shelves, birdfeeders, shopfittings and component parts, we’re delighted that that this strong performance has continued – despite an escalation of the turbulence and hot air coming from Westminster and Brussels.
Uncertainty is not good for business – it makes it hard to plan, invest and operate with confidence. In quarter 2 UK manufacturers had plenty to contend with, thanks to the early rounds of the Brexit negotiations and six weeks of electioneering following Theresa May’s ill-judged decision to go to the country in search of a stronger mandate and bigger majority.
In quarter 3 the uncertainty, if anything, ramped up. The election result has had many alarming consequences for the business community. We now have a clipped government with a very slender majority and a Prime Minister struggling to assert their authority. Many are now bracing themselves for the possibility of Jeremy Corbyn at number 10 Downing Street, with John McDonnell at number 11 – which will not be a welcome prospect for many British business owners and managers. What’s more, the slow progress of the negotiations between David Davis and his EU counterparts have increased the likelihood of a “no-deal” outcome on trade, another scenario that is very bad news for our economy, especially the manufacturing sector.
Despite all the external challenges facing British manufacturers over July, August and September we have proved remarkably unfazed by these distractions. This is testament to the resilience of the sector and the quality of the products. The EEF/BDO manufacturing survey shows that over half the companies surveyed over the quarter reported increased levels of output. Equally encouraging, this positive performance was evident across almost all the sub-sectors, including base metals, metal products, mechanical, electrical, electronics, rubber & plastics, transport and other miscellaneous sectors. The overall outturn this quarter exceeded most expectations at the start of the period.
What explains this excellent performance? The answer, it appears, lies overseas. Political upheavals at home have had much less bearing on matters than the economic activity in foreign markets. The number of businesses reporting an increase in export orders has mounted an impressive recovery over the first nine months of 2017, rising from -2% in the last quarter of the previous year to +33% in the last three months. Most sectors covered by the survey were pretty bullish about the export prospects, with basic metals, mechanical and electrical sub-sectors riding particularly high on this export wave.
In terms of financial performance the report highlights a number of positives. Some manufacturers are rebuilding margins if they are able to take advantage of the lower value of the pound to boost profits. On top of this, improved cashflow, solid demand prospects and another uptick in company-level confidence has contributed to a strengthening of investment intentions. Companies’ capital expenditure plans have been positive since the end of 2016 and investment plans have gained added momentum over the last quarter to achieve a level that is now at a ten quarter high.
In terms of our own business, Dymond Engineering anticipates continued strong demand for our design-engineering, value-engineering and metal fabricating services.
Will this strong performance by British manufacturers continue? There are so many imponderables that making any kind of prediction with confidence is almost impossible. On the downside there are understandable worries about the outlook for the UK economy in 2018 – firms may be upbeat about their own performance prospects the same cannot be said for the country as a whole. The EEF/BDO report notes that confidence in the UK economy has slipped for the second consecutive quarter. Weak official growth statistics, subdued forecasts from the Bank of England and the ongoing worries about the Brexit negotiations and the likelihood of getting a trade deal with the EU are all cause for caution.
Having said that, it’s all too easy to give more credence to the doomsayers. One positive, of particular relevance to UK manufacturers, is the steadily rising wages in emerging economies. A recent report by Steve Johnson in the Financial Times, and quoted in an article by Forbes Magazine, reveals that that China’s average wage level has tripled between 2005 and 2016.
This may gradually make it less attractive for companies to outsource their manufacturing to the likes of Asia and South America, something that can only be good for manufacturing companies in the UK. This trend also creates a hugely expanded middle class with the disposable income to buy consumer goods, thereby creating greater demand and boosting the world economy as a whole – a trend that is sure to create exciting opportunities for our domestic producers who are willing to export their goods to the BRICs and beyond.
Whatever happens, the British manufacturers who can avoid the wider political and economic distractions to concentrate on producing great products and do a great job of meeting customer needs, will continue to thrive. That’s certainly where our focus lies – so if you need high-quality light-weight metal products including components, office furniture and retail display systems just get in touch.
Please read Dymond Engineering’s terms and conditions for details of our modus operandi.
The team at Dymond Engineering are very pleased to announce the recent appointment of Marcus Kenny as our new Product Design Engineer.
Graduating in Mechanical Engineering from the University of Derby in 2013, Marcus has a wide range of experience in product design, metal production and project management.
Whilst at university Marcus won the University of Derby Technology Innovation of the Year Award for developing a training aid to develop firefighters’ understanding of casualty evacuation process from HGV’s
After graduating Marcus moved to North Devon to take up a graduate position with an international business. As Graduate Innovation Engineer his role was to manage the product development of new and innovative concepts, which involved product design, costing, production methods and project management, from concept to delivery.
Marcus then worked as Design Engineer and Project Manager with a local metal fabrication company. This involved liaising with clients, managing budgets and production costs, working with the production and site installation teams, ensuring projects came in on time and budget to the customers’ specifications.
As well as product design and development Marcus was involved in Project Management, pricing and quoting, client management, supply chain management and implementing lean manufacturing.
He then took 6 months out to establish his own Slacklining business and once that was running smoothly he worked as Operations Coordinator with a local company before joining us at Dymond Engineering & Metal Products.
Marcus is fitting into the team well and has impressed us with his skills in prototyping and project managing new product development. Marcus says he is enjoying the hands on nature of his role and particularly enjoys the diversity of working with 2D, 3D and hands on design work, as well as learning new skills. These include operating the CNC laser and learning to TIG and MIG weld amongst other things. He’s enjoying the fast paced production environment.
Outside work Marcus’ interests include climbing, Slacklining and travelling. He is always off on adventure when not working.
We are delighted to have him in the team. If you have any prototype work with us then Marcus will be your man. He looks forward to working with you.
Dymond engineering was delighted to sponsor the inaugural Scratch golf competition at High Bullen Golf Club this year.
Mike Garner is a member at the club and suggested the Scratch competition whilst he was a member of the club committee.
We are pleased to say the competition was a big success, they even enjoyed great golfing weather.
Alas Mike’s golfing prowess did not prevail on the day, but by contrast, Dymond’s design engineering skills will be utilised in the design and making of the unique trophies which will be presented at the annual Awards evening.
For further details about Dymond Engineerings modus operandi please read our terms and conditions.
Our new and improved galvanised bird feeders are proving very popular and selling well this season. Word is spreading amongst the Gamekeerper community and we are proud of the latest testimonial provided by Exmoor Headkeeper, Gareth Clark.
“We are already using most of the 40 feeders and I am delighted to say after over 2″ of rain all the feed remained bone dry.”
“This season we have started using the Dymond Engineering Partridge Feeders.
They are well built weighing some 25kg empty, thus not blowing around. They are 100% water tight, suitable for the Exmoor wind and rain.
Holding approximately 60kg of compound pelleted feed, they enable keepers to fill only in favourable weather, say on a twice a week basis. NO wet pellets clogging feeders at all.
Certainly we will look to increase our feeder number in years to come.” Gareth Clark, Headkeeper, Buttery Sporting.
Gareth’s comments certainly reflect the feedback we get from Headkeepers and shooting estates.