Covid and Brexit could see UK manufacturers bringing it all back home – The Guardian

UK factories could be making up to 4.8bn more goods for British retailers in the next 12 months as the coronavirus pandemic and Brexit prompt businesses to bring home production.

The additional orders, largely of food and fashion but potentially including DIY products and homewares, would be equivalent to the countrys entire current clothing manufacturing output, according to a report by advisory firm Alvarez & Marsal and research group Retail Economics.

Signs of the trend have already emerged with online fashion site Asos making its new lower-priced AsYou range at approved factories in Leicester, and Ted Baker announcing its Made in Britain range this month.

Retail businesses are making changes after the pandemic highlighted structural weaknesses in global supply chains which can be slow to adapt to sudden increases or drops in demand caused by shock events or rapidly changing consumer tastes.

The possibility of a no-deal Brexit under which tariffs as high as 80% could be introduced on some meat and dairy products, 12% on clothing and 16% on footwear has also prompted retailers to consider alternative options, according to the report.

Consumer and investor demand for more sustainability is also playing a big role in the change as the environmental cost of shipping goods from the far east, with many ending up unwanted, is now being factored in. Seven in 10 of the retailers surveyed for the report said they had already started changing the way they sourced goods to meet green or ethical targets, the report said.

In Wales, 70 former Laura Ashley sewers have returned to the clothing industry at a new factory in Powys, where ethical supplier Fashion Enter is making clothes for Asos and has just landed a contract with online clothing specialist N Brown, the owner of Simply Be.

Jenny Holloway, the chief executive of Fashion Enter which also has a factory in north London, said business was up by more than a third this year. She said retailers were looking for more responsive supply close to home, after the uncertainties of the pandemic highlighted the inflexibility of shipping clothing from Asia.

Its commercial suicide to back long lead-time stock at the moment. Retailers are getting closer and closer to the season, she said. There is no way I would have opened the factory in Wales unless I was certain theres a long-term trend in coming back to the UK. Its exciting.

Meanwhile, over-50s fashion brand David Nieper is hiring 30 new dressmakers and investing 4.5m in a textile factory employing a further eight workers in its home town of Alfreton in Derbyshire, where it will print and dye its own fabrics.

Christopher Nieper, the chief executive of David Nieper, said: Manufacturing in Britain makes business accountable and allows control over each step of the production process.

Offshoring manufacturing is essentially offshoring responsibility and indeed pollution. Currently two-thirds of emissions from UK clothing occur overseas. Its not acceptable to shift the problem to where its out of sight and out of mind.

In Kent, fruit and vegetable crisp maker Nims Fruit Crisps, has seen business surge 20% this year despite taking a severe knock from the Covid crisis.

Nimisha Raja, the chief executive of Nims, said the company had been forced to switch to selling dried fruit and vegetables as ingredients for fellow snack makers and dried fruit for pubs, bars and gin fans to use in drinks, after the lunchtime takeaway market was hit by the shift to working from home.

The shift by retailers is only part of wider changes in supply chains prompted by Covid and Brexit.

Tony Hague, the chief executive of PP Control & Automation, is part of the UK manufacturing Unite group which offers a dating service for manufacturers looking to work together to bring production home. Started in response to the Covid ventilator challenge, the group now has 300 members.

Its not a short term thing, he said. It takes a lot of time and effort to move a supply chain back to the UK. You dont just do it for a few months.

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Covid and Brexit could see UK manufacturers bringing it all back home - The Guardian