Suppliers lifted by rise in summer output

An upturn in manufacturing activity over the summer months has raised hopes of a recovery in the UK catering equipment supply chain.

The Confederation of British Industry (CBI) revealed last week that the British manufacturing sector in general has seen a significant rise in production levels during the three months to August, alongside markedly improved order books.

News that output grew at its fastest pace for two years prompted the CBI’s director of economics, Stephen Gifford, to declare that manufacturers were experiencing a “build-up in momentum”.

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UK catering equipment manufacturers told Catering Insight that they, too, were seeing similar trends as those evident in other parts of the British manufacturing landscape.

Tim Tindle, managing director at Falcon, said: “We have seen a steady increase in orders now for a sustained period of time. We are cautiously optimistic that the worst of the downturn is behind us, as we see increasing sales across most sectors and geographical areas that we serve.”

Victor Manufacturing’s managing director, Mick Shaddock, agreed that business had improved dramatically over the past three months.

“We have been working overtime since the end of June and seven-day working in some areas throughout July and August,” he revealed. “August is looking like it will be our biggest month for sales turnover in the company’s history. September looks good, but we have little visibility beyond that.”

Shaddock added: “Business confidence does seem to be improving, so we can only hope that trade continues to be buoyant. Talking to others in our industry, our experience seems to be typical of the market.”

Other manufacturers also said that the recent increase in output versus the early part of the year and the corresponding period last year signalled a stabilisation of the market.

Jon Usher, head of UK sales and marketing at GDPA, commented: “A greater optimism within the sector and a willingness by dealers and distributors to enhance stock levels has been a direct result of end-users’ recent commitment to new projects or existing projects which may have previously been put on hold. Over the past three months, GDPA has seen double-digit growth year-on-year, with a particularly strong June, July and August so far.”

In the refrigeration space, meanwhile, Williams Refrigeration said that a flat first quarter of the year had been superseded by a “significant increase” in demand for products since June.

The company has even had to start thinking about building stock levels back up after sales of its Jade range soared 61% in July and August versus last year, revealed sales and marketing director, Malcolm Harling.

“I think that there is some momentum building,” he added. “A number of the UK-based chain restaurants are posting good numbers and therefore investing in their estates. This is the same for breweries and, of course, sectors such as garden centres and coffee shops.”

Industry trade body CESA gave further credence to suggestions that catering equipment manufacturing activity has strengthened.

“The anecdotal feedback that I have had from CESA members over recent weeks reflects the CBI’s findings,” said CESA director Keith Warren. “We have members who are taking on additional staff to cope with increasing order intake.

“There has been a significant improvement in business confidence and I am sure that this will be further supported by increased trading as a result of the good summer weather. Members are still having to cope with tight margins but overall volumes appear to have stabilised following a difficult start to the year.”

Warren did sound a note of caution, though, warning that while the upturn is welcomed, CESA does see problems resulting from orders being placed for almost immediate supply.

“Production improvements have helped manufactures to respond but with less stock being held it can cause problems with availability,” said Warren. “If the supply chain can purchase to reflect the lead times required by manufacturers, then this will solve the problem to everybody’s benefit.”

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