UK aerospace manufacturers may be missing out on £867m
Research from Wyelands Bank shows that UK mid-sized aerospace manufacturers could be missing out on £867 million in revenues due to insufficient access to finance.
The research of UK mid-sized aerospace manufacturers, turning over £10m to £300m, shows that nearly of all firms (94%) are held back because of a lack of finance.
Difficulties raising finance to support their growth have stopped them from winning new contracts and that has stifled new job creation.
Each aerospace firm said that the difficulties raising finance meant they had missed out on an average of £17.7 million in revenues and an average of 37 new contracts. These would have enabled each firm to create 41 new jobs.
These figures suggest that the 140 mid-sized aerospace manufacturing businesses in the UK have collectively missed out on 1,813 contracts. These would have created 1,394 jobs and some £867m in revenues.
The Wyelands Bank research shows that difficulties in raising finance also prevent 82% of aerospace firms from investing in new equipment or technology. Nearly a third (29%) have also been held back from entering new markets and just over a third (35%) have been prevented from moving to a new site or premises.
Iain Hunter, CEO of Wyelands Bank, said: “Our research shows that UK mid-sized aerospace manufacturers are not able to grow to their full potential without greater access to finance. But that finance has not been available as traditional banks are too often unable to help.
“Helping mid-sized aerospace businesses unlock growth would help tackle the UK economy’s productivity challenges. Mid-market firms can have a disproportionate effect on growth and job creation, but first they need to be understood as individual businesses.
“It takes time and effort to understand a firm’s specific challenges, and identify how to help them. This must then be underpinned by a range of flexible financial solutions to help shape the right answer.”
The study was conducted by Circle Research and completed in November 2018. The research surveyed 305 UK mid-sized manufacturers turning over £10m-£300m. Respondents were senior financial decision makers.