INVESTMENT in machinery and developing new products are key priorities for UK manufacturers over the next 12 months, according to a study by The Manufacturer magazine and Barclays Bank.
The Annual Manufacturing Report shows signs of increased confidence in the sector and a considerable increase in companies seeking to invest more.
Over a third plan to spend more on research and development in order to create new products and more than three out of five firms say they will spend in excess of £100,000 on machinery and tools this year.
Chris Forrest, Sheffield-based head of manufacturing for Barclays Northern Region, said: “There is a clear overall improvement in confidence compared to last year which, coupled with the increase in planned investment spend, is very encouraging to see.
“There is however still concern around future prospects as the economic outlook continues to be challenging, but a focus on R&D and innovation can only mean good things for the sector.”
Mr Forrest also highlighted what appeared to be a trend for UK manufacturers to do more business overseas.
“It is not surprising to see UK manufacturers focus on new markets as they look to benefit from faster growing territories,” said Mr Forrest.
“This will also provide them with diversified income sources and wider opportunities for the application of their intellectual property.”
For the first time in three years, companies are indicating they are very likely to return some of the manufacturing they do abroad to the UK.
However, a quarter of companies are also considering moving part of their operations overseas.
The Manufacturer’s Tim Brown said companies considering moving operations overseas must beware of hidden implications such as loss of skills, difficulties with consistent quality and long lead times.