The Manufacturing Agenda
Expert voices Partner outlook
Investing in financial processes may not have been possible, or simply wasn’t the priority at the time. Time and again, though, I’ve seen that these capabilities must move up the priority list if long- term value creation and resilience is the goal. Beyond providing clearer visibility of operational health, these forecasts are a critical communication tool. They help bridge the gap between board and lender perspectives. By investing in metrics and tracking, firms learn lenders’ language and strengthen their ability to present realistic, backable growth – which is what lenders are looking for when making lending decisions. This matters even more now than it used to. Where manufacturers might once have built lender confidence through more basic approaches, having good operational data is now non-negotiable. Where these capabilities aren’t in place, bringing in expert advice can provide immediate benefits. Providing perspective From the other side, we often find opportunity by helping boards assess the long-term consequences of short-term decisions. A clear example is putting capex plans into perspective.
In volatile operating conditions and under acute cost pressures, some manufacturers are delaying major planned capital expenditure – whether in plant, facilities or people. The decision to suspend investment is often driven by immediate priorities: preserving cash, protecting margins, managing working capital. But too narrow a focus can itself be damaging. While capex delays might save money now, they can erode competitive edge or mean missing future growth opportunities because the capability that the capex was supposed to deliver never came through. This risk is particularly high if major capex decisions are repeatedly pushed out. Small shifts can build up to put manufacturers far behind. Some of the most valuable conversations I have are with manufacturing boards in this position, where we assess what the real cost of capex trade-offs might be and explore alternatives that keep firms on the path to maximising long-term value while addressing immediate pressures. Ultimately, this all comes back to making sure different viewpoints – big picture and small; long- term and short-term; lender and board – remain aligned as operating conditions continue to evolve.
Matt Whitchurch Financial Advisory Partner at FRP Connect on LinkedIn
Our work in Financial Advisory is about helping clients make informed decisions – advising boards on how to preserve and restore value, and helping lenders assess whether to extend debt facilities. What stands out from our experience is how directly successful value creation depends on getting the operational and financial fundamentals right. The big picture and the day-to-day detail are inseparable.
Forecasting fundamentals
Part of this comes down to having the right processes and models. Every manufacturer should have a 13-week rolling cashflow forecast, and ideally a long-term fully integrated P&L, balance sheet and cashflow forecast. These sound straightforward, but they’re frequently missing – often for entirely understandable reasons. SME manufacturers are juggling multiple demands with limited resources. 15
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