Texcel Technology’s commercial director, Peter Shawyer, shares his thoughts on the challenges that UK CEMs face in 2023 and the key elements needed for growth
UK manufacturing industry, including the electronics sector, is still facing many challenges. This has been the case for over two and a half years and the year ahead looks no less daunting. So, what are the key qualities a UK CEM needs to survive and thrive?
Some of the current market challenges result from global geopolitical forces. This category includes supply chain issues, limited semiconductor manufacturing locations and rising energy prices. Others are closer to home: Brexit has significantly impacted logistics and worker availability, while inflation is at its highest level for over a decade.
So, what are the options for navigating these choppy waters? This is where flexibility and agility kick in.
Financial stability is a precursor to flexibility. During the pandemic Texcel increased its component stock by over £2M which helped the company smooth out some supply chain issues and continue to deliver to OEM customers. Financial stability made this possible. The company continued to invest in capital equipment to improve productivity and efficiency. Key investments included more automated production equipment and upgrading the ERP system to improve forecasting, purchasing and production scheduling. Companies without a solid financial footing pre-pandemic haven’t been able to flex the same way and not all survived.
Market spread. Automotive had another dismal year, demonstrating the risk of supplying a vertical market. Businesses track market ups and downs. Texcel’s OEM customers supply a range of sectors and geographies, thus ‘smoothing’ business.
Lastly, changing the business mindset using mental agility has been key. The last two years have been the most disruptive in Texcel’s 45-year history. Pre-pandemic the business ran smoothly, changes were planned well ahead and scheduling covered weeks and months. The pandemic forced a paradigm shift. Habits and routines were replaced by thinking outside the box. Although challenging, this added creativity to problem solving techniques and will continue to shape the company and support its future growth.