With its ever-changing landscape, trends that come and go in the blink of an eye, and the abundance of cheaper products from China, it’s safe to say that the PC manufacturing industry is a competitive one.
We’ve heard many times over the past few years that the desktop is dead, laptops are being taken over by tablets, and consumers only buy their products from etailer Amazon. On the face of it, one would wonder how British manufacturers are still able to survive in the current tech market.
The past 15 years have seen the PC industry hit with two recessions, the first in the year 2000 and the second beginning in 2007. But dig a little deeper, and not only will you find that the economic tide has started turning – with UK PC sales increasing by 10.7 per cent between January and November last year, but there are numerous desktop, gaming system and laptop builders in the UK that are still keeping British PC manufacturing alive.
THE STATE OF THE MARKET
So what is the current state of the market? We spoke to some of the prominent manufacturers and system builders in the UK and the overall feeling was generally quite positive.
Centerprise has one of the UK’s largest manufacturing plants in Wales at 50,000sq ft, while CMS Computers is a leading UK Local Original Equipment Manufacturer (LOEM) of build-to-order desktops, notebooks and tablets. Its commercial marketing manager, Dave Ayling, tells PCR: “We feel that the recession had a positive side effect on British PC manufacturing. Local brands and configuration services started to be considered, when previously only the multinational brands were either shortlisted for tender or were able to break through in consumer advertising.
“This sits hand in hand with our conviction that until you find a way to do without desks, then desktops are still an important form factor. So far both of these statements have held true in our year-on- year trading growth. Innovation in form factors is still key, but we must not forget to support the IT departments and hobbyists that require systems they can customise and repair themselves,” he adds.
Novatech has been providing IT solutions to professionals, enthusiasts, businesses, education and the public sector for over 27 years. The firm’s managing director David Furby agrees that British manufacturing has taken a bit of a battering over the past few years, but the firm has held out and believes times are getting better:
“Recent reports from CIPS UK Manufacturing PMI and Boston Consulting Group have shown that this is on the turn, with UK manufacturing growth speeding up in the latter half of 2014. Novatech are proud to be part of that trend.”
Peter George, director at Dorking-based gaming and simulation PC builder Wired2Fire, believes that current PC manufacturing is actually extremely competitive and consumers should be careful about what companies they choose to buy products from.
“Margins are incredibly low which is a barrier to new companies entering the market,” he says. “Low pricing is great for the consumer, but they need to be very careful that they do not choose a company that increases their margin by reducing service.
“Also, looking into a company’s history isn’t a bad idea. One or two companies out there ‘reset’ every few years, which means they go bust and dump their debt, leaving warranties worthless before setting up under the same name with different directors,” warns George.
Speaking to Jon Silvera, founder and managing director of programming and electronics workstation manufacturer Fuze, we can see how British companies are not only building products in the UK, but sourcing parts here too: “Since conception we have tried to keep as much of our manufacturing in the UK and certainly as much as possible sourced locally.
“We do assemble here in Aylesbury, we source a great many of the components in the UK, even the nuts and screws are and all our packaging is from Aylesbury. All our content is written here and our programmers live here,” adds Silvera.
Craig Hume, director at Utopia Computers, which has been building high performance PCs in Kilmarnock, Scotland for almost 20 years, tells PCR that system builders are far too tame: “I think that most system builders out there are simply looking to what the guys at the top are doing and just replicating that model. At Utopia, we aim to raise the bar, set new standards of customisation and really push the boundaries.
“I would like to think that in a few years the UK SIs will be more like their US counterparts when it comes to product and service innovation,” he says.
It’s not just system builders that are keeping the British flag flying. There are also consumer electronics manufacturers like Veho who design and engineer all their products in the UK.
“Formed in 2006, we now have products in just about every big retailer, including Dixons, Harrods, Maplin, Tesco, Asda and more,” Veho’s CEO and founder, Steven Lewis, tells PCR.
WHY BUY BRITISH?
So we know there are products out there designed, manufactured and sold in Britain, but how does that really benefit consumers?
“This isn’t rocket science. Workers living in the UK pay tax, VAT, mortgages and duty,” says Fuze’s Jon Silvera.
Rakesh Selarka from retailer and service provider PC Surgeon, believes UK manufacturing will help Britain regain its industrial identity: “The UK is highly reliant on foreign imports, often where the product is adapted for the UK and not designed for the UK. This means that our market is directly affected by economic conditions in other countries. For the UK to regain its industrial identity and any economic stability it is important for homegrown products to be encouraged on a daily basis.”
Nick Lidington, chairman of kiosk system manufacturer Olancha Group, concurs: “The only way the UK will rise out of its financial situation is by not only designing things, but by manufacturing the designs in enough volume for sale in the UK and ROW. The world wants quality looking and well made products at a good price point – it’s what the UK has done well in the past and has the capability of doing now and in the future.”
As well as helping the UK economy, buying British- made technology should also mean much better standards and customer services for consumers.
“For the end user it should mean they are getting great service alongside an outstanding quality product. Britain has always been proud of its manufacturers and the PC industry should be no different,” says Utopia Computer’s Craig Hume.
“For the design and configuration of PCs a local build-to-order system provides you with the exact PC you want and need, not what was planned into distribution six months ago by a multinational manufacturer,” adds CMS Computers’ Dave Ayling.
“Take this and combine it with the UK based technical support and customer services, and you get a service that is local where it needs to be, and global where it makes a real difference.”
Novatech’s David Furby agrees that consumers benefit when it comes to customer services: “We’ve always believed in keeping things in- house. Our customers can order a custom build PC, a mouse mat or 200 servers and we can deliver them faster, and support them better than a supplier who outsources their builds can.
“Over 250 people work at Novatech and each one of them is involved in giving our customers amazing machines. The people who build our machines sit less than 100 metres from our after sales team, who are just across the room from the people who pick up the phone when you give us a ring. We have a real level of integration and unrivalled support, which we believe non-British manufacturers can’t match, and we know our customers value us for it,” he adds.
THE FUTURE OF UK TECH
While it’s clear that there’s a lot going on in the UK manufacturing market, the industry can only keep evolving if more and more retailers and resellers get on board with stocking British products and relaying the benefits of buying British to their customers.
PC Surgeon’s Rakesh Selarka calls for support from disties and other firms in the channel: “We need independents to focus and specialise in their field of expertise, for distributors and component manufacturers to be more supportive and for large retailers to call it a day. Remember we are a proud nation of shopkeepers who prefer to offer a local and personalised service, we are not a faceless corporation.”
Selarka also stresses that educating the industry is just as important. “It does not help that when I speak to industry colleagues, their usual stance on training and educating youngsters to become the next tech gurus is ‘Why do you want to train them? They will only go and put you out of a job’. This is only true if you’re hopeless at your job.”
Gary Stonehouse, owner of retailer GBiz IT, urges UK manufacturers to shout about themselves a little bit more: “I think if somebody started shouting about the fact that they were British we’d probably be more inclined to consider their products, perhaps stock them, and we’d probably shout about them as well and make it a prominent feature of our retail displays that they were British.
“I would certainly like to support British manufacturers.”
THE UK TRADE: 7 FACTS
Here are some impressive facts about the British system builders and manufacturers that have taken part in this feature.
FUZE recently made a special edition of its device, paying tribute to the 8 BIT micros from the 1980s.
CMS COMPUTERS has grown to hold a market share of over 20 per cent in the last 20 years.
OLANCHA GROUP started life as a distributor of other companies’ products, but has now re- fashioned the business to becoming a design and manufacturing firm over the last five years.
NOVATECH is partnered with Microsoft and Intel, is CHAS accredited, and also gained an ISO 9001 and 14001 certification.
UTOPIA was the very first independent computer manufacturer to have its products listed on Argos’ site.
WIRED2FIRE has won best buy awards from a number of major magazines.
VEHO currently has distribution in over 120 different countries around the world.