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3 minute read - 2nd June 2023

Report shows two-thirds of SME manufacturers rank sustainability as being of high importance

Sustainability has become a key priority for manufacturing decision-makers but smaller companies need more guidance and support to accelerate progress, new research has found.

Made in Group’s inaugural Big Sustainability Report shows that sustainability has become a critical focus for manufacturers driven by customer and supplier demands, regulatory requirements and a desire for greater operational resilience and relevance. Most manufacturers have embarked on their sustainability journey by investing in energy-efficient lighting and HVAC systems, switching to eco-friendly packaging materials and introducing company-wide recycling schemes.

Overall, however, it appears that more progress has been made in operations compared to production activities. This likely reflects the cost and complexity of installing energy-efficient bulbs versus re-engineering products or investing in new machinery. Ultimately, while awareness surrounding sustainability and carbon emissions has grown, the majority of small businesses remain in the foothills of the transition. As a result, decision-makers are seeking support and best practice from others to accelerate their progress.

Top priorities manufacturers have for sustainability in 2023 are to formalise strategies and switch to renewable energy sources / Picture: Getty/iStock

Tracking industrial business growth

Set up to champion and promote UK industry, Made in Group – comprising Made in the Midlands and Made in Yorkshire – is a peer-to-peer membership association with more than 500 members representing all sectors of manufacturing and engineering. Approximately 85% of members are owner-managed small and medium-sized businesses.

Made in Group’s series of Big Reports tracks industrial business growth and the strategies owner-directors are executing in response to challenges and opportunities. In addition, each report will spotlight a key trend impacting the manufacturing sector. Following sustainability, future editions will explore People & Skills, Smart Factories and International Trade. Responses this time round were split equally between Made Group members and non-members, 46% and 54%, respectively.

Most common sustainability steps already taken by manufacturers include energy-efficient lighting, eco-friendly packaging materials and company-wide recycling programmes / Picture: Getty/iStock

Manufacturers rising to the challenge

Three-quarters of those surveyed, 72%, reported business growth in 2022 despite having to deal with soaring input costs and ongoing supply chain disruption. One in three recorded business growth greater than 20% and one in four of more than 10%. Less than one in 10, just 7%, experienced a contraction; a testament to the sector’s characteristic resilience. Many respondents believe a sustained uptick in demand, lessening disruption and easing inflationary pressures will further help to boost output and growth.

Jason Pitt, CEO of Made in Group, said: “It’s very encouraging to see that sustainability is such a high priority for manufacturing businesses, with many already taking practical steps towards increasing energy efficiency and reducing their carbon footprint. We firmly believe that the future of British industry lies in becoming a sustainable industry. With the need to change increasingly urgent and new regulations cascading down supply chains, many manufacturers are feeling overwhelmed and lost. It’s unsurprising, therefore, to see clearer guidance and support highlighted as a key lever to accelerating progress.”

“Sharing best practice is at the heart of Made in Group’s mission to bring the sector together, foster collaboration and provide the help SME manufacturers need to grasp the large-scale transformations they are facing. A key message frequently reinforced in our Made Masterclasses, for example, is how seemingly small acts can make a big positive impact.”

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