How is the cost of living crisis affecting the manufacturing sector

It’s a phrase that is causing many people in the country to grumble with discontent. The cost of living crisis has hit like a ton of bricks on top of the ton of bricks we received in the form of the pandemic.

The endless stroke of bad luck seems unfair and it’s only going to get worse for those who are already at breaking point. A lot of society is in the same, collective boat and many are left without a paddle.

This article will answer the question - how is the cost of living crisis affecting the manufacturing sector? With many sectors taking a hit, there are a lot of businesses that are struggling with the burden. Not only from the aftermath of the pandemic but now with the cost of living crisis having an impact in many ways.

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What is the cost of living crisis?

The ‘cost of living crisis’ is a term being used to describe the current state of living. It means we’re all paying a lot more on our energy bills and everything in general, is becoming more expensive. From rent to fuel, food to clothing, it’s all going up. 

As a result, many are making cutbacks on their spending in order to save money. Many are currently deciding whether to feed themselves or heat their home. The reality of the cost of living crisis is bleak and tragic, to say the least.

How are consumers being affected?

It’s safe to say that all consumers are being affected by the inflation rate. While that might be so, not everyone is impacted in the same way. Low-income consumers are the ones that are seemingly the most impacted by the cost of food and energy rising. The challenge that many have is that their wages haven’t risen in order to accommodate this.

As a result of the cost of living crisis, many have cut back but for some, no amount of cutting back is helping. Even with very little food on the table and switching their heating off, they’re still living beyond their means - and this isn’t a choice they’re making either.

Consumers are therefore relying on debt, which is only making things worse for the future.

How is the manufacturer affected?

With many industries affected, how are manufacturers affected by the cost of living crisis?

Energy cost

With the rise in energy costs, it’s making it more difficult to operate the usual working hours. Many are struggling to keep the lights on, let alone keep their equipment running. 

Businesses, as a result, are needing to find more smart and cost-efficient ways of saving on their energy bills.

Lightning electric icon. Bolt circle symbol. Power charging energy sign. Vector illustration.

Transport

The price of fuel and transporting goods or services have seen considerable hikes in cost. Cash flows are therefore being stretched and businesses are finding themselves in a predicament. 

With low cash flow and rising transport costs, there’s no other way for some businesses to continue doing business. It’s resulted in many having to outsource these services to save money.

9.2 How Is The Cost Of Living Crisis Affecting

Material cost

Material costs have soared higher and higher over the last year, which has had a knock-on effect on what a lot of businesses charge their customers in order for them to just breakeven. 

For example, over our busiest period between December 2021 and June 2022 one of our most commonly used machining materials, epoxy tooling board, increased in price by 45.5% in just 6 months. Prior to the cost of living crisis, we could expect to see tooling board prices increase by roughly 3 to 5% over a 12 month period.

How is the cost of living crisis affecting the manufacturing sector

At Penta Patterns we understand that many businesses are all in the same boat, and society as a whole has been affected by the cost of living crisis. If your business is struggling or you are struggling personally, visit the GOV UK website to see what support is available.

Given the economic pressures, our expert team at Penta Patterns strives to provide design and manufacturing services at the best possible price.

Penta Patterns is driven to provide businesses and designers with a variety of products and production services within a number of industries. Just take a look at what our customers have achieved already using our specialist services.

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