Reshoring

Brooks Forgings is committed to the ongoing development of its capabilities and rebuilding confidence in British manufacturing.

Following the Global Economic Crisis in 2008 many companies decided to offshore the production of forged components in order to remain competitive in the marketplace. Sourcing components and moving entire production facilities abroad has had a negative impact on British Manufacturing.

Many decision-makers in our industry are now looking at reshoring the production of forged components back to the UK. Many factors have influenced this decision such as long lead times, overdue or short deliveries, poor quality, and more serious issues such as counterfeit materials and loss of intellectual property.

Brooks Forgings are now working with customers that are interested in reshoring forged components and have realised the benefits of bringing their requirements back to the UK.

Key reasons for buyers reshoring to the UK

• Communication problems
• Quality & environmental issues
• Slave labour issues
• Tax rates & import tariffs
• Exchange rate fluctuation risk
• Loss of intellectual property
• Larger volume commitment and investment
• Counterfeit materials and components
• Hidden and additional costs
• Low-cost automated manufacturing in the UK

Our comprehensive range of manufacturing capabilities, quality approvals and traceability, and experienced, knowledgeable staff are all notable benefits that we can offer. Customers also have the added peace of mind that they are dealing with a long-established reputable manufacturer that can be contacted easily to discuss new projects, supply or quality issues, or even a visit to see us and our facilities in person.

• Communication problems
When dealing with foreign manufacturers the language barrier can be a challenge. A difference in time zone can restrict communication to email rather than telephone and delay responses.

• Quality & environmental issues
Problems with quality are only identified when the shipment has arrived in the UK. This is typically 12-14 weeks via ocean freight. Quality issues can be difficult to resolve swiftly and components often require rework to be completed in the UK at an unexpected cost. This also causes further delays in your final supply to the customer or end-user. Environmental issues are also a concern with many far eastern governments enforcing stricter regulations on and even closing galvanising and finishing plants.

• Slave labour issues
Many tier 1 and blue-chip companies require manufacturers and suppliers to have a strict policy regarding slave labour in their supply chain. If you’re unable to verify if your manufacturer abroad is using slave labour or not then you may be removed as an approved supplier with your customer.

• Tax rates & import tariffs
Fluctuating tax rates and alterations to tariffs can increase the price of specific goods and services purchased overseas. Initial prices may seem attractive but it is easy to get caught out with additional charges on goods already in transit or required as part of an ongoing annual contract.

• Exchange rate fluctuation risk
The global economic climate is constantly changing and this impacts currency exchange rates on a daily basis. This can have a negative impact if rates move against you and you have to pay in your supplier's currency different to your own.

• Loss of intellectual property
It is not uncommon for foreign manufacturers to reuse tooling and product design once a contract has ended. Intellectual property rights are harder to enforce and monitor abroad and you may face legal action from your customer if you haven’t taken the necessary steps to protect them.

• Larger volume commitment and investment
It is not uncommon for foreign suppliers to ask you to commit to a large single order, enabling them to provide cheaper prices for the component and shipping. The risk is greater in this situation because you are making a single large investment with no guarantee that the components will be supplied on time or of sufficient quality. You may also be left with surplus stock if your customer goes out of business, often unique to them with no resale value.

• Counterfeit materials and components
Original mill certificates are often supplied incomplete, unclear, or in a foreign language. This can make it difficult to confirm that the correct material is being supplied and from a legitimate source. There is also a risk of the supplier using counterfeit goods that are normally purchased from their own supply chain to form part of an assembly.

• Hidden and additional costs
When experiencing issues with quality and production abroad they can sometimes only be resolved face-to-face, requiring a visit. This involves additional costs such as airfare, accommodation, and other general expenses. If there are delays in production, air freight is a quick solution to expedite supply in order to meet end-user deadlines. Airfreight is costly and compensation is rarely offered by the supplier. In addition, after paying a premium, there is no guarantee that the goods you receive will be of acceptable and useable quality and rework costs can also be incurred.

• Automated manufacturing in the UK
At Brooks Forgings, automated manufacturing is primarily used for high-volume production and offers increased production rates due to an extremely consistent and undisrupted workflow, and the overall quality and dimensional accuracy of components is improved, reducing scrap and waste. Operating costs are also reduced, enabling us to be competitive in the international market and ultimately reshore components that were lost to foreign competitors.