Posted to News on 20th Sep 2016, 16:04
Herga Technology faces post-Brexit with optimism
Following the June referendum and our Government's insistence that "Brexit means Brexit', Herga Technology is taking a positive stance towards the future. As part of the Variohm Holdings Group, the UK manufacturer employs 85 staff in its Bury St. Edmunds facility - designing and producing footswitches, hand controls and sensing systems for industrial and medical applications. Rather than join the doom and gloom brigade, Herga is looking at the positives and whilst there is still uncertainty and a need for our government to begin setting out firm plans for the future, they have found some reasons to be cheerful.
With sterling now at significantly lower levels against all major currencies, Herga's export book has been expanding - even in the short time since the referendum - with USA, and European customers taking full advantage of lower component purchasing costs. With the US$ trading substantially higher than the sterling and that trend seemingly set to continue, British exports for manufactured products that are sourced in the UK are set to thrive. As a major supplier to major medical equipment OEMs which are dominant in the USA and Germany, Herga's sterling-adjusted costs and its international distribution support network will appeal.
UK-based OEMs that have relied on purchasing switching components from overseas are also finding Herga's pricing appealing. The stronger currencies have risen by an average of 10 per cent since Brexit and that, coupled with US$ linked fuel costs for long-distance shipping, has meant that many UK manufacturers are being squeezed, and are turning to UK-sourcing to regain their margins.
Demonstrating its optimism through investment, a recent Brexit-initiated decision for Herga included a 60k investment in production mould tooling for a new footswitch that was to be placed with a Far East supplier but was awarded instead to a UK company. Whilst costs were an important consideration, the much faster delivery and local service and support from the UK supplier were driving factors. Significant investment in plant, equipment and business systems improvements have continued since Herga Technology's acquisition by the Variohm Holdings Group in 2013.
But Herga's optimism is not just about the pound. The indications are that post-Brexit, the UK can begin to redress its imbalance between the service and manufacturing industries. British-manufactured high-technology equipment is sought after worldwide and can gain substantially, if future conditions outside the EU permit. As a manufacturing SME, Herga is looking towards those pro-leave politicians that campaigned on the basis that there will be less red-tape and consequently reduced costs. Like many companies in a similar position, government initiatives for technology investment will be vital in the future.
Managing Director, Roy Moffatt explains: "Herga Technology's optimism is clear. We have continued to invest in people and equipment but also have made substantial business performance and systems changes that have made Herga a much greater force in the global market for footswitches and hand controls. Our recent ISO 13485:2012 medical quality management system accreditation and ISO 9001:2015 status is another example of our commitment to the future."
More information about Herga Technology can be found at www.herga.com.
