Will Access to Funding Hold Back Manufacturing?
As the United Kingdom exits recession the headlines being written about the UK manufacturing sector paint a welcoming picture. Recent headlines include:
"Bright future for British Engineering" (FT 21 February 2014).
"UK Manufacturing – strong upsurge continues at the end of 2013" (BBC, 2 January 2014).
"While Britain is often portrayed as a country which does not make anything anymore, UK manufacturing output is actually on the rise" (FT, 21 February 2014).
However, the question arises whether as UK manufacturing expands, the Banks will be there to provide the finance that they might need…
"Small and medium-sized businesses still battling for funding, the Bank of England data reveals" (The Guardian, 21 January 2014).
"Biggest fall in business lending in six months" (The Telegraph, 21 January 2014).
While Britain develops a higher quality manufacturing sector, a shift which may well prove very important as a means of business expansion and economic competitiveness worldwide in the forthcoming years, questions remain as to whether businesses will be able to develop and achieve the success that could possibly be available to them in the future unless the banking sector in the UK starts to lend money to those industries. Most market data suggests presently that the banks are lending less than is being repaid and questions remain with regard to the access to finance for the manufacturing sector to develop.
The Government is of course trying to put pressure on banks to lend more money, the banks however are still looking for quality lends before they are prepared to advance funds and lending criteria remain tight. There is clearly tension in the marketplace but a well-structured manufacturing proposition should still be able to achieve funding.
The banking, finance and manufacturing teams at Michelmores, work together with banks, finance houses, equity and venture capitalists and corporate clients to help structure finance and facilitate business expansion and restructuring. If any of these things are an issue or could be an issue on the horizon for you please let us help you to facilitate the financing that you may be seeking.
If you would like more information in relation to any of the issues discussed in this article, please contact Charles Maunder at Charles.firstname.lastname@example.org.