Despite the headwinds of Brexit, inflation, energy prices and supply chain issues, UK manufacturers are upbeat about growth – if they can be sure of funding.
A survey conducted by manufacturing trade body Make UK found that 52% of UK manufacturers plan to grow their business by more than 20% over the next five years.
However, in order to do this, manufacturers said they needed to be able to access finance so they can invest in areas such as digital technology, industrial decarbonisation, innovation and staff.
So how can they access this finance?
While big ticket investment requires large amounts of capital funding, there are still many areas where manufacturing firms can create some of the conditions for growth by accessing finance for all those costs which add up daily, and if left unchecked, can eat into profit margins and provide a drag on the business.
Particularly now, with inflation high and supply chains under stress, it can be easy for costs to increase. Necessarily, manufacturing firms often rely on multiple suppliers in the production process, and this makes it difficult to always understand where the financial stress points are, because they are often unseen at the time they are needed.
As an example, with fuel costs being higher, it can be more expensive simply to move material around and with delays due to a wide range of global factors, it might be that other supplies have to be brought in at short notice.
Just to keep the wheels of industry turning in this way, costs can start to rise, and while sometimes it is unavoidable, it can be managed before it gets out of hand.
While having a strategic plan is preferable, if you have to act tactically and react quickly, you need the means to pay for it while still retaining control. There should never be a blank cheque to solve an issue.
Being able to pay for fuel, maintenance, materials and supplies at short notice through business credit cards such as Allstar Plus and Allstar Expense, yet still retain control, allows a manufacturer to not only see what is happening on the shop floor, but also keep spending in check and manage cashflow.
For most manufacturing companies, money must be spent on production before it can be recouped in sales. By managing indirect costs and expenses through Allstar cards it takes the pressure off to recoup that spend immediately.
As a result, a controlled cashflow system for things like incidentals and everyday expenses frees up capital to be invested elsewhere, in critical, core business areas such as stock, equipment and production.
Allstar Plus provides an additional line of interest-free credit up to 44 days*, which gives your firm additional flexibility when it comes to buying stock and materials.
Manufacturing is often complex and requires the input of many departments. To truly ascertain the cost involved in any process or project, it’s important that all expenditure is allocated properly.
This doesn’t just mean accuracy in terms of pound note value, but also timeliness. Pulling together all the expenses involved in a team, project or process can take time and the result is that procurement will not have full oversight of costs. Through digital payment reporting, you can see what is being spent, and where.
Also, if receipts are lost or expenses not paid until much later, it creates stress and friction between the employer and employees. By putting in place streamlined digital processes for uploading receipts and paying employees for spend, you can be flexible, agile and responsive when managing costs.**
Allstar Online allows you to manage all of this in one place and at individual card level, controlling what can be bought, capping spend where necessary and seeing in real time who is spending, and on what.
Allstar’s business credit cards can help facilitate growth, and solve financial logjams, that will aid your manufacturing business to grow. Head here to find out more about how our expense solutions can help you.
*Subject to status and credit check.
**ExpenseIn is a separate product that can be added to your Allstar Visa account.