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UK Machine Builder Conferences - a review

05 November 2012

Mitsubishi Electric Europe B.V.visit website

 

Mitsubishi has organised a series of free UK Machine Builder Conferences, the first of which took place at its premises in Hatfield on 31 October 2012. Jon Severn, editor of MachineBuilding.net, attended this event and provides the following review.

The UK Machine Builder Conferences are being organised by Mitsubishi in conjunction with UK Trade & Investment (UKTI), the China-Britain Business Council (CBBC) and the Processing & Packaging Machinery Association (PPMA). The conferences are aimed at machine builders that are contemplating exporting to Asian countries such as China, the ASEAN (Association of Southeast Asian Nations) countries and others including Japan, South Korea, Taiwan and Hong Kong.

Market demand

During the presentations in the morning session it became clear that the Asian market offers significant potential for UK machine builders, though it is essential to have a specialisation to offer, and a mix of product and service is very attractive to prospective customers. Far Eastern countries are finding that demand for engineering talent is outstripping supply, so wages are rising rapidly. Nevertheless, manufacturing companies have a real need for automation, partly to replace increasingly expensive labour but also because they need to achieve the high quality standards necessary today. In particular, high-technology products such as smartphones cannot be assembled manually, as automation is the only way to achieve the requisite precision. Being unable to satisfy their need for automation by using domestic machine builders, Asian manufacturers are looking for suppliers abroad.

Barriers

Although the market potential exists, there are barriers (or perceived barriers) to entry for UK machine builders. These range from language, cultural differences and regulations - such as CCC (China Compulsory Certificate) marking, which is similar in concept to European CE marking – to the fear of theft of IP (intellectual property), concerns about how to get foreign currency out of China, and fears about making a long-term commitment. However, the presenters showed what support is available, often free of charge or at a relatively low cost, to help overcome these challenges. They also suggested an easier initial route to these markets: if a machine builder is already supplying a UK customer that has operations in Asia, then it can be simpler to start by supplying to that company’s Asian operation before endeavouring to export to a native manufacturer.

Exporting for beginners

At the Hatfield event the first presenter was Robert Doak of UK Trade & Investment, a Government body that provides support for UK exporters, who spoke about how to approach exporting for the first time, and the opportunities presented by Asian countries other than China. Robert Doak also outlined how UKTI can fund research and provide advice by means of its specialist staff located in the Far East. In the event of a machine builder having difficulty persuading local bank managers to provide loans to back export activities, UKTI staff can also speak to bankers in London in support of the machine builder.

Chinese market(s)

Next on the agenda was Stewart Ferguson, Head of Research at the China-Britain Business Council, which helps companies trading in China. Stewart Ferguson spoke in more detail about how to approach the Chinese market (in fact China offers many different markets, as particular industries are largely centred in specific provinces); CBBC can advise not only on current market opportunities, but also future opportunities – which is important, given the rapid pace of development. In addition, Stewart Ferguson gave some excellent insight into the ways in which UK companies should and should not try to sell to Chinese customers (telling a customer what you can do for them is seen as arrogant, whereas running a seminar can present you as an industry expert; building relationships and trust is vital, as this wins new business and can lead to more in the future because Chinese people often ask friends and associates for recommendations when seeking new suppliers).

Practical support in China

Grant Collier stood in for Chris Buxton of the PPMA, a UK trade body representing the interests of companies in the processing, packaging, robotics, automation, vision and polymer processing industries. Grant Collier outlined the PPMA Dragon Service that helps companies to explore the Chinese market and, if appropriate, start doing business through the PPMA's serviced office in Shanghai. In particular, the PPMA Shanghai office can employ a local member of staff on the exporter's behalf, thereby reducing risk, minimising managerial effort and keeping costs under control.

By the end of these presentations and the question-and-answer sessions it was clear that there is huge potential for UK machine builders, though entering Asian markets is not easy. Plenty of help and support is available, and there are ways to minimise risk and costs of entry. Numerous UK companies have succeeded in Asian markets, so there is a strong argument for UK machine builders to take a serious look at this option if they are seeking to expand their business and insulate themselves from the difficulties in the UK economy.

Competitive advantage

The second half of the conference focused on robotics and automation technologies. While these can help UK machine builders to gain a competitive advantage when exporting to Far Eastern markets, they also offer benefits to companies operating closer to home. Chris Evans, Marketing & Operations Group Manager for Mitsubishi Electric Europe, outlined how Mitsubishi can act as a partner for machine builders exporting to Asia, even to the point of undertaking service visits on behalf of UK companies. Next there was a joint presentation by Jon Sumner, OEM Solutions Sales Manager at Mitsubishi Electric Automation Systems Division UK, and Barry Weller, the company's Products Manager for Robots. They talked about some of the latest products and technologies available from Mitsubishi, and how machine builders can use these to gain a competitive advantage – whether or not they are exporting. In addition, Grant Collier described the Automating Manufacturing programme that still has six months to run, enabling UK manufacturing companies to get free consultancy and a report showing how they could benefit from automating production processes.

Exhibition

Alongside the conference there was a tabletop exhibition where delegates could speak to a variety of suppliers to the UK machine building market. The exhibiting companies were Lutze Group, Westermo, Wittenstein, Cognex, Brook Crompton, Balluff and Sick.

Overall the conference provided an excellent insight into how to approach the potentially lucrative Asian markets, and showed that there is plenty of specialist support available to help overcome the challenges. The speakers were knowledgeable, experienced and, at times, entertaining as well.

Follow the link to find out more about events organised by Mitsubishi Electric Europe.

 
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