Many advantages in relocating overseas
Nick Jones MD, Redfern International Sir; Manufacturers have much to gain from outsourcing production overseas ('The best of British - coming to you from somewhere abroad', Supply IT Supplement, 12 May, p10). Over the next few years, it is likely that a record level of food and drink production activities will be transferred overseas to counter rising production costs. The costs of running a factory in this country have never been so high: property and overheads including employee wages have soared in price, and resources are gobbled up by government red tape. At the same time, the quality of goods produced in the Far East has improved immeasurably, and working conditions are often better than in the UK. As the gap between production costs here and overseas has become a gulf, the transfer of manufacturing and sourcing operations to lower-wage economies has already obliterated our fashion and low-technology industries. However, the death knell is unlikely to ring for UK food and drink production. Demand for food and drink products is dictated by a number of factors, of which price is just one. Where freshness and authenticity are key priorities, many people are willing to pay extra. In addition, the decision to outsource can prove unpopular with consumers if UK jobs are lost. And with cargo ships larger than ever, our ports and domestic transport system are struggling to cope with increased levels of imports. Those who have transferred their manufacturing overseas are reaping rewards. And if companies do not question their own business model, someone else will do it for them.