Dave Atkinson, UK Head of Manufacturing, SME & Mid-Corporates at Lloyds
The business case for investing in new machinery is well understood by manufacturers. The right equipment can support diversification, boost productivity, reduce operational costs, increase capacity and improve energy efficiency. Yet the sector has experienced a prolonged period of underinvestment.
This is understandable. Weaker demand, higher costs and economic uncertainty have all contributed to firms pausing or scaling back their plans.
But CapEx investment can take a number of years to realise, so manufacturers need to look beyond short-term challenges and prioritise opportunities that can achieve clear long-term gains. Because those able to commit to new investment now will be well placed to remain competitive for years to come, both at home and abroad.
Minimising risk, optimising impact
The good news is that there is a wealth of support available to help manufacturing firms minimise risk and optimise the impact of their investments.
Lloyds’ long-term partner the Manufacturing Technology Centre (MTC) can support throughout the procurement process, including developing a business case, writing a requirements specification and identifying the most appropriate suppliers.
It also works to help firms develop high-value manufacturing skills through apprenticeships and upskilling or reskilling employees, with a focus on advanced technologies like digital manufacturing.
Because investment in machinery can’t happen in isolation; firms will also need a workforce that is equipped with the right skills if they are to harness the full potential of new technologies.
Enabling investment
When it comes to finance, Lloyds has a portfolio of solutions designed to help maintain cashflow and spread the cost of any investment.
Asset Finance, for example, is a way to pay for machinery in monthly instalments, making budgeting more straightforward. It’s a flexible way to release cash from existing assets, unlocking their value to protect working capital and fund growth.
It’s a good option for manufacturers because it helps overcome the large upfront cost of investing in machinery and enables them to buy the right equipment, without compromise.
Investments can be supported through standard Asset Finance products like Hire Purchase, which provides a flexible and cash flow-friendly way to fund new machinery without paying in full upfront.
Capital Import Finance is also available to mitigate the risks of complex procurement and build processes. Whether the asset is sourced from overseas or within the UK, it provides finance for deposits and staged payments ahead of longer‑term Asset Finance solutions.
Sometimes, buying machinery from overseas can give a manufacturer a competitive edge, providing access to the best equipment the world has to offer. But it can also present extra risk, as international supply chains are more prone to disruption.
To help counter this risk, Lloyds Capital Import Finance covers the upfront cost and ensures funds are only released when the supplier meets their contractual obligations, giving confidence that the machinery will be delivered exactly as specified. And it also reduces exposure to foreign exchange volatility, locking in costs at the point of order, which is particularly useful for high value machinery with long lead times.
Finally, where investments are designed to support manufacturers’ low carbon transition, Lloyds Green Asset Finance works to support investment in equipment and vehicles that help firms achieve their sustainability goals.
It provides discounted lending against assets that reduce the environmental impact of the business. That means machinery that’s energy efficient or supports the production of sustainable products or circular economy adapted products and technologies.
Because becoming a low-carbon business isn’t only good for the environment, it can make manufacturers more competitive through efficiency savings, lower energy costs, access to new markets, increased employee engagement and enhanced brand reputation.
A transformative impact
These products are already enabling British manufacturers to modernise, expand and compete.
Like AW Hainsworth, an eighth-generation family firm based in Yorkshire, with more than 240 years of heritage weaving fine woollen cloth.
Though rooted in tradition, the business has adopted the latest automated machinery to boost capacity and efficiency, which has helped it grow revenues from £15m to £24m in just the last four years.
With a growth strategy based on expanding its product portfolio and entering new international markets, Hainsworth faced a capacity bottleneck which meant investing in digitalisation, automation, upskilling and specialist equipment from overseas. Capital Import Finance from Lloyds supported the acquisition and importation of new machinery, which was then converted to an Asset Finance facility to help manage cash flow.
Crucially, Hainsworth has also worked to create a pipeline of skilled local staff to support its growth, visiting schools, colleges and investing in apprenticeship and trainee courses.
With new machinery in place to boost capacity and efficiency, and a solid financial platform from which to grow, Hainsworth is now targeting revenues of £30m by 2030.
An approach that’s paying dividends
Specialist engineer Technoset, based in Rugby, supplies high precision components for sectors including aerospace and telecommunications.
In 2025 it invested more than £1m in ultra-precise automated machinery including lathes and machines for measuring and milling.
These investments, supported by an Asset Finance package from Lloyds, have enabled improved performance, shorter lead times and more cost-effective production, positioning the business to secure high-value contracts in demanding markets like high-performance automotive, medical, hydrogen and renewable energy.
Technoset has also prioritised skills development alongside engineering capacity and capability, working with MTC to recruit and train apprentices, who split their time between MTC Training’s state-of-the-art facility and real-world experience at Technoset.
It’s all part of a joined-up approach of investing in machinery and people that is paying dividends for British manufacturers. Because for the UK to secure its deserved place in modern sustainable supply chains, the time has come to act, innovate and invest.
