Small businesses are investing £20bn to meet growing customer demand

The outlook for small manufacturing businesses is brighter than it's been for a long time, but firms need to prepare now to benefit from increased output in the coming months and years.

As the British recovery picks up speed, the businesses that hire staff and invest in their production process first will be the ones who can meet the growing requirements of clients. That's what is leading almost half of manufacturers to invest in new machinery, premises or technologies now rather than waiting for the demand to come to them.

These figures, found by the Government's Manufacturing Advisory Service (MAS), are announced alongside news that hiring and sales within small businesses are set to rise.

Invest to remain competitive

"There appeared to be a greater appetite from SMEs for investment in order to remain competitive." Lorraine Holmes, area director for MAS, said, "I think we are also seeing a desire to create jobs to meet expected demand."

This paints a great picture for the coming months, but also a warning to small businesses across the country. If an energetic economic recovery is coming, it will cause huge strain on firms' cash flow, staff and stock. It will be the business' that prepare quickest who are ready to profit from the growth.

We definitely recommend taking a look at your cashflow, your resources and your employees to figure out how ready your business is for increased demand.

For more help with planning for the future, catch up with the King of Cashflow.

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