In August, Peter Davies recalled Tony Blair’s reference to manufacturers as ‘dinosaurs’, noting ‘a new buzz word – onshoring!’ He reflected that bringing back production from overseas, particularly China, will be a slow process but – – as there is now a smaller cost advantage to producing in China – this option will be considered more often.
Last week, more reshoring/onshoring news was relayed by Brian Groom, Business and Employment Editor of the Financial Times. RDM Group (Richmond Design and Marketing), an automotive component supplier set up 20 years ago and jointly owned by brothers David and Graham Keene, has leased a new £400,000 factory in Coventry which will house repatriated production from China. The new unit will house a £200,000 five-axis CNC machining and turning facility and other equipment.
RDM made components in China for the past eight years but now will manufacture aluminium rechargeable torches for Jaguar Land Rover at the new plant and bring the rest of its China-based work back by the middle of next year. Chairman David Keene (right) said: “We went there because it was going to be cheap, but cheap has turned into ever-increasing prices because wages and other costs are rising rapidly. The automotive companies are getting faster and faster in their cycle of delivering products. There is also a lot of personalisation going on. If you have got a supply chain that takes months to bring stuff in, you can’t be flexible.”
The Coventry Telegraph adds that RDM is almost doubling its premises and recruiting extra staff after being awarded a grant from round two of the government’s Growing Places funding scheme approved by the Coventry and Warwickshire Local Enterprise Partnership.
Bathrooms.com, the online retailer, is now handing half the contracts currently held by Chinese manufacturers to British suppliers based in the Midlands, reducing the time from design to production from six months to six weeks.
The Telegraph (national) adds that the company was set up nine years ago by Ian Monk, a former computing expert and his wife, Rebekah, a former teacher. The products, designed by Bathrooms.com and some in Italy, were made by manufacturers in China.
Ian Monk explained: “We want to move quickly with some of our product range, particularly around bathroom cabinetry. Is there a way we can get onto the latest trends and move with those trends quickly? Doing things in the Far East, it tends to take four to six months to get a product from conception to being in our warehouse ready to sell. With the latest products we’ve had made in the UK, we’ve achieved that in six weeks. We really want to be on the edge of design and, through partnering with firms in the UK, the process has been a lot faster and a lot less painful. Trying to communicate this stuff across the oceans using email and travelling out to China is a lot more laborious and more time-consuming. Not only does it take longer but the workload in man-hours to get a product to market is a lot more.”
UK manufacturers are ‘gearing up’
Mr Monk believes the “reshoring” trend will be good for the UK economy: “We’re finding some great UK manufacturers who have embraced this and are really trying to differentiate themselves and compete with China. Five or 10 years ago, you’d walk into a UK manufacturer and they would want massive minimum-order quantities. Now their production is much more geared up to working with people like us. We’ve been able to make this happen fairly quickly and painlessly”.
See further cautionary reflections from Professor Bailey: http://www.thebrummie.net/reshoring-really-is-happening-but-not-as-much-as-first-thought/