Conducted among manufacturing finance managers in 13 countries, the study found that manufacturers across the world are reporting a need to invest in new-generation technology in order to meet four key sector challenges. These are to: increase production capacity and flexibility to meet changing demand and drive sales; improve client service quality while reducing production costs, improve competitive positioning through improved product quality and broader product range, and optimise efficiency, cost control and manufacturing agility through automation and digitalisation.
In order to meet these requirements, manufacturers were increasingly diversifying their range of financing techniques to afford innovative digitalised technology, said SFS. Four in every five respondents regarded having a diverse range of financing techniques as “important”, “very important” or “critical” to developing their business.
More than a third of respondents expect to further diversify their financing techniques and sources in the next two years. Of these techniques, asset finance was the most frequently cited financing tool for technology acquisition, over and above traditional loans. Seven in every 10 respondents have used asset finance to acquire essential new technology in the last two years.
SFS added: “Asset finance is seen as a key investment facilitator because of its ability to accommodate the total cost of ownership approach to key technology. This enables reliable financial planning and improved calculation of production cost per unit. Payments can be adjusted to align with expected cost savings or efficiency gains delivered by the newly acquired technology. Investments in digitalisation and automation can therefore take place in a financially sustainable way. In addition to extending the available volume of financing, the speed and ease of the financing decision and arranging asset finance allows manufacturers to act fast to seize market opportunities.”
Brian Foster, head of industry finance at Siemens Financial Services in the UK, said: “Digitalised technology has opened up new opportunities for automation, customisation, scalability and cost efficiency.
“Through the use of smart financing techniques, pioneering manufacturers can deploy new technology platforms to improve product excellence, extend product range and reduce production costs.”
