Manufacturers more confident about short-term prospects, says survey

The survey of manufacturers in sectors as diverse as aerospace, food and automotive revealed that 37% of respondents were positive about confidence over the next six months, while fewer than one in seven (15%) were negative. Almost half of the respondents (48%) said their confidence levels were unchanged from the beginning of the year. Results varied by size, sector and location when it came to the question of whether margins would decrease, but in all 37% said they expected margins to fall, while 33% expected no change. Companies with turnover of less than £300m in the engineering, metal products and technology manufacturing sectors were most downbeat, with almost half expecting margins to slide. For all respondents, the most pressing issues were cash flow and sales. Companies also voiced a number of other concerns, including inability to insure debts and increasing government red tape. Tom Lawton (pictured), head of manufacturing at BDO Stoy Hayward, says: "The numbers overall are more positive than we were expecting, and there are indications that the sector is starting to improve, following an extremely difficult year. Manufacturers are having to work harder than ever to cope with the economic slowdown and issues such as falling sales and cash flow continue to weigh heavily on both large and small companies. It's also interesting to note that a number of companies of all sizes cite government red tape as one of their biggest headaches."