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Monthly Archives: December 2013

Supply Chains: Looking closer to home?

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In a year when supply chains have hit the headlines in the mainstream media on a regular basis, Duo UK's operations director Dale Brimelow reflects on how some big players are shifting their procurement focus a little closer to home.

Supply chain issues have stalked the headlines this year, ranging from the horsemeat scandal which knocked millions off the share prices of leading supermarkets, to the collapse of a Bangladeshi clothing factory which cost more than 1000 lives. As well as the human and financial cost, both crises also caused much consternation and soul searching among the British public and an associated slew of negative publicity.

Of course these aren't the first supply chain stories to hit the main stream press - Nike, for example, has been dogged by accusations of child labour for years, but there are signs that other factors are now aligning with CSR concerns, leading at least some big British buyers to review their processes.

At Duo UK we provide postal packaging to the likes of John Lewis, Tesco and JD Williams and undoubtedly, along with the quality, service and technical expertise Duo has, the fact that we manufacture our polythene in the UK is viewed as a big plus point.  Backing this up is quantitative research we conducted into the buying preferences of procurement professionals which revealed that, particularly among bigger corporations, there was a strong affiliation to buying from UK manufactures.

Almost 80% of corporates we spoke to believed British businesses should buy from British suppliers where possible,  with just over 40% claiming there is a 'moral case' for taking this stance.  What's more, 52% of corporates are doing more than just talking and are actively looking to increase their UK supplier base.  Key motivators for this action are revealing - 78% identified shortening supply chains or ethical concerns with some overseas suppliers, while almost 50% cited increased transport cost as a driving factor. Around a third said they struggled with longer lead times and reducing competiveness of overseas goods.

So far so promising for British manufactures, but it would be naïve to assume there are no hurdles left to overcome. The same research shows that a third corporations believe that British made goods are uncompetitive, while a very similar proportion (31%) claim the goods they need aren't manufactured in the UK.  

This latter point is particularly interesting. Obviously there will be some products that simply aren't made in the UK - no country could claim to manufacture every product businesses could ever need - but time and again we come across people who are surprised that polythene packaging can be manufactured competitively in the UK. The common perception is that this type of manufacturing will long since have shifted to China or East Asia. However, as Duo's success has shown this patently isn't the case and I've got no doubt that there are many other manufactures working away, day-in day-out to produce world beating goods that not enough people know about.  

As an industry changing this perception, so those procurement professionals who automatically look overseas to at least investigate home grown options, would be a massive step forward. In turn, this should start to shift perceptions that British products are always more expensive than overseas goods, particularly if we educate buyers on the whole life cycle of the product. There's no point in embarking on a race to the bottom in terms of creating low skilled jobs or cutting corners on health & safety or pay & conditions, but very often the purchase price is just the start of a cost to a business, and doesn't reflect the real expense.

If as a sector we can work to highlight both the strength and variety of British manufacturing and its relative competiveness, we are pushing at an open door - British businesses are keen to buy closer to home, now our task is to make it easy for them.

 

This article was featured on The Manufacturer

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