The clock is ticking down to the 23 June referendum on whether the UK should leave the EU, and the result could have a major impact on British industry, of which the catering equipment manufacturing sector is no exception.
But many competitors have very diverse views on what that effect could be. For instance, fabricator Pland Stainless is unsure of what the impact to its business would be, as it sources its stainless steel from within the UK, but the raw material in the supply chain originates in Sweden.
“It’s largely an unknown factor in the longer term,” said MD, Steve Duree.
“We supply numerous public projects in the UK, so if public spending fluctuated, then it’s likely that our own business would fluctuate in line with that.
“A further sector of our business supplies other UK manufacturers with OEM pressed components for their respective home markets and export markets around the world. Again it’s unknown what effect that would have on our customer’s orderbooks.”
As Pland imports some components from Europe, it has been taking a close interest in the money markets and recently committed to forward-purchasing Euros, which Duree said has benefitted the firm when paying its European suppliers.
For its finished products, exports comprise around 7% of turnover, with the majority of sales focused in Ireland and the Middle East.
“In terms of our global sales, we have had to re-visit some quotations because of the weakness of Sterling, and as in Europe, our market prices continue to feel pressure from competing manufacturers in Turkey, Italy and China to name a few,” Duree reported.
While he acknowledged that stainless steel prices have fallen a little over the last year, he commented: “Unfortunately, association of the word ‘steel’ has customers believing we’re enjoying huge reductions in the stainless steel industry, but this is not so.
“In manufacturing today, yield of raw material is of paramount importance and when we laser cut our components, we nest our products to try and make best use of our raw materials.
“Even when we have perfect nesting, there’s an element of scrap that’s just thrown away for recycling. Unfortunately, that scrap stainless steel when recycled retains a fraction of the original purchase price. When we factor in this scrap stainless steel we generate as a by-product and the reduced scrap value thereon, there’s no significant cost change in our buying price of stainless steel.”