Backing UK Manufacturing Through Highs and Lows

Backing UK Manufacturing Through Highs and Lows

UK businesses returned to growth at the end of 2020, with the IHS Markit purchasing managers’ index (PMI) climbing to 50.7 in December from 49 in November (on an index where a figure above 50 indicates expansion). Manufacturing led the way at the close of 2020, with the sector’s PMI hitting a three-year high of 57.3. With factories remaining open, the manufacturing sector was unaffected by November’s four week lockdown in England, with output at its highest since December 2017.

However, the most recent IHS Markit/CIPS Purchasing Managers’ Index indicated a decline to 54.1 in January, as manufacturing growth slowed to its lowest rate in three months. The score was higher than the analyst estimates of 52.9.

Chris Barlow, head of manufacturing at MHA, explained that UK manufacturing was “artificially boosted” in December as companies took measures to avoid anticipated chaos at ports as the transition period came to an end but warned that “Brexit trade friction is starting to bite.”

IHS Markit director Rob Dobson, who observed that the UK’s manufacturing sector “has come close to stalling”, commented that “a mixture of harsher COVID-19 restrictions and Brexit led to near-record supply-chain disruptions, lower exports and increased costs”

At Praetura, we are proud to be backing British Manufacturer’s through the highs and the lows of this new era. As has so often been the case in the past, manufacturing has proved itself to be the backbone of the UK economy in terms of its underlying resilience and strength. As we enter 2021, agility will also prove critical for manufacturers.

Powered by a company’s assets, asset-based lending (ABL) provides both the stability that manufacturing businesses need to weather the storms ahead and the flexibility to realise opportunities for sustainable organic growth and future acquisitions. Now is the time to explore the deal structures that will ensure stability and drive success in 2021 and beyond.

For more information on how we can help manufacturing clients meet the challenges of the present and maximise the opportunities for the future, please call me on 0161 302 6310 for a confidential conversation, or email

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