FRP's 'The Manufacturing Agenda' report revealed that nearly a third (30 per cent) of senior decision-makers expect their boards to lead acquisitive buy-side M&A over the next 12 months, while a similar 29 per cent anticipate sell-side activity. Skills and talent remain a priority, with 29 per cent expecting board-level action and 40 per cent planning increased investment in this area.
These expectations follow a year in which manufacturers report their boards have concentrated on addressing structural challenges, including ESG regulation (26 per cent), geopolitical friction and trade changes (25 per cent), supply chain disruption (24 per cent), and margin pressures or unexpected cost increases (24 per cent).
Looking ahead, businesses are also prioritising investment in sustainability, with 40 per cent reporting dedicated ESG compliance and decarbonisation initiatives and succession planning.
The report also highlighted contrasting priorities between boards and lenders. When asked what would prompt intervention in a portfolio company over the next year, lenders and investors cited cost, cashflow and working capital (44 per cent), investment in automation and digital execution (41 per cent), and leadership resilience (37 per cent).
In a statement, Tom Cox, debt advisory partner at FRP, said: "These results reflect a sector that's redefining resilience. It's no longer just about financial strength – it's about making strategic investments when they matter most, and having the resources and support to adapt at pace.
"While there are some areas of alignment between the priorities of boards and lenders, there are significant gaps. This matters because a misalignment in perspectives could be limiting access to the funding manufacturers need for their growth and M&A plans. Firms that take time to understand lenders’ priorities – and communicate their strategy in those terms – will be best positioned to secure the backing they need to keep building their resilience over the year ahead.”
The report can be downloaded and read in full here.
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