Production returning to UK as cost advantage in China diminishes

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More and more companies brought manufacturing back to Britain in last three years according to EEF, with signs trend will continue.

Manufacturers are bringing production back to Britain at an increasing rate, attracted by the UK’s technical edge and a diminishing cost advantage in countries including China.

The main reason given for moving production back was to improve the quality of products and components, with other factors including certainty, speed of delivery, and cost.

Lee Hopley, EEF’s chief economist, said that while the difference in wages paid in the UK and China is still enormous the gap is closing and overall the cost advantage of basing manufacturing operations in China has been eroded, when elements including transport and logistics are included.

For around 40% of companies that had re-shored production, turnover increased as a direct result, with 3% reporting a fall. Around 60% reported a moderate rise in profits and employment.

If your company are considering re-shoring your manufacturing back to the ‘UK’ then please contact Kasdon Electronics on 01902 606 068 who will be more than happy to support you with this process.