Manufacturing: Diversification opens doors to new markets
THE region’s manufacturers have to be fleet of foot and alive to new opportunities in new sectors, if they are to thrive in a global market place.
The was the consensus of a panel of industry experts and manufacturers debating the sector’s future challenges and opportunities.
For those manufacturers unable to cast their net beyond these shores, entering new domestic markets was seen as essential.
Bacup-based kitchens, bedrooms and bathrooms manufacturer JJO, a £30m turnover company, only sells its products in the UK, and had to enter new markets as spending on core products fell as the recession hit the property market.
Managing director Stephen Greenhalgh explained: : “Furniture is bulky so we are stuck in this market. Unless we attract more sectors or take market share it is hard for us to grow. Residential (property) is still looking at up to two years for recovery, so we diversify where we can.
“We spotted the slowdown quickly so moved into bathroom manufacture. That now approaches 15% of turnover from a standing start four years ago. Without that we would have had to really look at the cost base.”
Birkenhead-based shipbuilder is another North West business that has successfully diversified into the energy sector.
Director David Williams said: “We have done that by taking our core ability and seeing how it can be applied in other markets, so we are now in offshore energy markets.
“On the nuclear side, it seems a new fleet of nuclear reactors will be built at some stage so we have built relationships with key companies in those sectors to help establish our position and bring those diversifications on.”
Being innovative and finding new uses for your products in different sectors is also a must for continued success.