The results suggests many are turning to asset-based finance and other forms of alternative finance to enable investment in ‘next-generation’ technology required to bring the industry up to speed with digitalisation and other challenges.
Asset-based finance is a form of working capital and credit that can be secured against real estate, machinery or other equipment.
The SFS report is based on interviews with manufacturing financing managers across 13 countries, including the UK, US, China and India. Seven in ten respondents said they have used asset-based finance to fund the acquisition of new technology in the past year.
The research also highlights four major sector challenges that this new funding is used to address. They are:
- To increase production capacity and flexibility to meet changing demand and drive sales
- To improve client service quality while reducing production costs
- To improve competitive positioning through improved product quality and broader product range
- To optimise efficiency, cost control and manufacturing agility through automation and digitalisation
Brain Foster, head of industry finance at Siemens Financial Services in the UK, said that 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,“ he continued.
