The saying ‘speculate to accumulate’ has been in existence for more than 70 years: businesses must be prepared to invest to make meaningful gains. While this implies a degree of operational risk– the truth is that businesses cannot prosper unless they make significant investments in their assets which, for manufacturers, are facilities, materials, equipment, and personnel.
Investing in your manufacturing company is not, however, a game of roulette, but a reliable way of enhancing productivity, efficiency, and brand reputation. Ideally, profits that a business generates should be reinvested in the company to stimulate growth and further profits; however, the current taxation system, which requires manufacturers to pay corporation tax on their profits, even when reinvested, places an artificial ceiling on how much money can be put back into a business’s development – unless it’s capital equipment thanks to the AIA.
It’s a point raised by Hone-All’s director, Andrea Wilson, in a recent interview with GB News, who said, “We shouldn’t have to pay corporation tax on profits when we’re reinvesting all those profits.”
So, what are the most important principles about investing in your manufacturing business to stimulate growth and enhance your organisation’s success?
Futureproof Your Business
In the first instance, investing in new technology, particularly when driven by IT, environmental enhancement, automation, or Artificial Intelligence (AI), will improve your business’s efficiency and productivity, as well as saving time and money. But in a competitive marketplace and an equally challenging fiscal environment, new tech can make your brand appealing to customers by delivering more precise components, more quickly, for less and with a reduced impact on the environment. Staying ahead of your rivals is crucial to safeguard your business’s future, so investing in the latest technology will help you to achieve this.
Strengthen Staff Loyalty
Your team are one of your most valuable assets. Workers don’t always crave higher pay above all else; instead, they need to feel they are valued and are being professionally developed through personalised training, helping them to play a valued part in your business’s success. Investing in your team may mean rewarding them with pay rises or bonuses, when justified. However, to secure long-term staff loyalty, it’s vital to provide opportunities for them to develop new skills and responsibilities in a flexible, thriving, and forward-thinking workplace culture.
Make Your Business More Appealing
Once you’ve invested in new equipment, investing money into a marketing campaign can showcase your business’s commitment to delivering the highest quality results for your customers and build trust and awareness. Entrusting your team to create attractive photographs or promotional videos for distribution through social media channels can raise your company’s profile, enticing new customers and staff who will perceive your brand to be a key player in its market.
Attract The Best Talent
Finally, no one wants to work in unsavoury conditions, so investing in your workplace environment can be a magnet for new talented staff. There are many ways to do this, from creating an ethical environmentally friendly workshop to developing an ergonomic workspace that encourages collaboration and creativity – two vital components of modern manufacturing. By investing in your working environment, you can increase staff satisfaction, retention, and make your business more attractive to new talent.
Investing in your manufacturing company can require a leap of faith, so focusing on the long-term benefits will add greater confidence to your decision-making and ensure your profits are invested wisely. For more information please get in touch today.