Manufacturing

The manufacturing sector is at the forefront of many of the big changes across the economy. Technological advancements, such as artificial intelligence, automation and robotics, and rising support for higher environmental, sustainability and governance (ESG) standards are modernising manufacturing processes and shifting consumer preferences. These catalysts are changing the market environment for all manufacturers, influencing the demand profile of consumer goods (e.g., electric vehicles and ethically sourced fashion), and prompting firms to source sustainable raw materials and other inputs.

At the same time, economic conditions have increased the cost of debt and reduced liquidity and investment capital. Markets need to adapt to lower than anticipated growth and related challenges. Geopolitical challenges complicate supply chain management, exacerbated by regional conflicts. All of which means that capital  investment plans and M&A activity, which are amongst key drivers of activity in the sector are subject to challenge and delay. Non-core activities remain under scrutiny with exits and closures an option. Larger manufacturing firms are focused on the modernisation of their operations, aligned to the clean energy transition, decarbonisation and enhancing supply chain resilience. Smaller manufacturing firms are more responsive to the evolving requirements of larger firms, commonly their clients. Small manufacturing firms need to manage risk of delayed investment decisions and work orders, and shifting demand patterns due to the impact of larger firms’ modernisation objectives.

At BTG Advisory, we work with manufacturing businesses, their supply chain and funders across the business and economic cycle. We can assist businesses with a diagnostic assessment that identifies viable cost reductions to address inefficiencies, achieve cash savings, optimise use of working capital to improve overall operational performance and cash flow generation. Businesses may also benefit from an independent assessment of their balance sheet to support viability working capital requirements with growth and investment ambitions.