16th February 2024
When it comes to applying close attention to growth (and the acceleration of growth), private equity firms continuously seek innovative strategies to maximise returns within their investment portfolios.
For private equity firms with manufacturers and new technology innovators within their portfolios, the quest for sustainable growth presents unique challenges and opportunities. One strategic avenue that holds immense potential is forging partnerships with outsourcing providers.
PP Control & Automation (PP C&A) has a formidable track record in unlocking growth potential and helping manufacturers overcome typical constraints they may face, ensuring that they can sieze that all important “window of opportunity.”
Furthermore, its PP Plus network is designed to help GreenTech innovators bridge the well-documented and challenging valley of death.
But why exactly can outsourcing partnerships serve as a catalyst for accelerating the growth trajectory of machine builders and OEMs within the purview of private equity firms?
There are three key areas of focus.
Private equity firms are well-versed in the delicate balance between risk and reward. When it comes to nurturing the growth of manufacturers, mitigating risk becomes paramount.
Outsourcing partners offer a strategic solution by shouldering the burden of resource-intensive tasks such as engineering, supply chain management, production and test.
By entrusting these functions to specialised outsourcing providers, private equity-backed businesses can negate the need for significant investments in personnel, infrastructure and equipment and keep tighter control around working capital requirements for the organisation in question.
Creating fixed cost of ownership through outsourcing that matches output volumes also offers benefits over increasing overhead costs that then become a burden if volumes then reduce.
Read up on how PP C&A invests in its people, facility, and equipment.
PP Control & Automation has set its sights on breaking the £40m sales revenue barrier in 2024 after having seen sales rise from £24m to £36m over the last twelve months.
The third in a series of six programmes from UK Manufacturing TV looks at the challenge facing SME manufacturers to recruit the skills they need, now and in the future.
Three PP Control & Automation directors roll back the years and document the impact different investments over three decades have made on the business.
PP Control & Automation joined and hosted the WMG, University of Warwick Net Zero Innovation Network Cohort this month as it looks to further boost its green credentials.
PP Control & Automation has completed the installation of 450 sq metres of solar panels on the roof of its world-class facility in Cheslyn Hay.
PP C&A has signalled its intentions to ramp up investment in its recently launched Bright Sparks University (BSU).
PP C&A has invested over £100,000 into creating a new Electrostatic Discharge manufacturing facility.
A world first in ‘crimping’ technology has been installed PP C&A to help with increased demand for its strategic services.
A new £1m factory extension has been unveiled by PP Control & Automation as it singled its intention to double sales by 2021.
Private equity firms thrive on agility and scalability, virtues that are equally essential for the growth of manufacturers. Outsourcing partnerships offer a flexible model that can adapt to evolving market dynamics and fluctuating demand patterns.
Whether scaling up production to capitalise on a surge in orders or pivoting operations in response to shifting customer preferences, outsourcing providers offer the agility necessary to navigate these challenges.
By leveraging the expertise and resources of outsourcing partners, private equity-backed businesses can pursue growth opportunities with confidence, knowing they have a responsive and scalable production infrastructure in place.
Innovation lies at the heart of sustained growth and competitive differentiation. However, for many manufacturers, the pursuit of innovation can be hampered by resource constraints and a narrow focus on core competencies. Outsourcing partnerships offer access to a broader pool of specialised talent and cutting-edge technologies, helping private equity-backed businesses build a culture of innovation and customer-centricity.
By tapping into the expertise of outsourcing providers, manufacturers can accelerate product development cycles and R&D, introduce innovative features, and stay ahead of market trends. Equally, they can focus more intently and apply more resource and budget to sales and marketing efforts to grow market share.
Afterall, growth is still the fastest way to increased profitability.
A collaborative outsourcing approach not only enhances the value proposition for customers but also positions private equity firms’ portfolio companies as industry leaders poised for long-term success.
PP Plus is an easy access support network designed to help create a more sustainable and environmentally friendly future by supporting the growth of technological innovations in the UK.
PP Plus offers three pillars of support (Manufacturing, Business, Academia) that give access to hundreds of capabilities, services, and methods to help fledgling businesses rise through seed investment, to the flourishing market debut of their ground-breaking green technology.
The PP Plus partner network, founded by PP C&A, is a carefully curated collective, selected with discernment and purpose. They share a unique blueprint for better collaboration. Together, they constitute the most accessible growth support network in UK manufacturing, serving as the catalyst for a multiplier effect that unites entire communities in the shared mission of guiding successful innovation.
For more information on how PP Plus is supporting GreenTech innovators, see the brand new website, launched to promote its important mission and the services of its network of over 20 partners.
Private equity firms excel at optimising capital allocation and strategic focus to maximise returns on investment. By partnering with outsourcing providers, private equity-backed manufacturers can redirect capital resources towards core strategic initiatives such as market expansion, product innovation, and strategic acquisitions.
Outsourcing frees up financial resources that would otherwise be tied up in infrastructure investments, enabling private equity firms to deploy capital more efficiently and strategically.
Moreover, by offloading non-core functions to outsourcing partners, machine builders and OEMs can concentrate their efforts on areas where they can deliver the most value, further enhancing their competitive positioning and growth prospects.
Outsourcing partnerships represent a strategic imperative for private equity firms seeking to accelerate the growth of manufacturers within their portfolios. By mitigating risk, enhancing flexibility, unlocking innovation, and optimising capital allocation, outsourcing providers empower private equity-backed businesses to achieve sustainable growth and competitive advantage in a dynamic marketplace.
As private equity firms continue to navigate the complexities of investment management, forging strategic alliances with outsourcing partners emerges as a key driver of success.
Ian Knight, Chief Information Officer at PP Control & Automation (PP C&A) challenges the prevailing, often vague narrative around AI adoption and reframes the conversation around a more practical starting point: operational constraints.
Artificial intelligence is no longer a distant concept for manufacturers. It is already being explored across quotation, production planning, engineering, quality, supply chain and customer service functions. Yet, for many organisations, the gap between experimentation and meaningful operational impact remains difficult to close.
A leading aquaculture specialist – that is changing the way fish are vaccinated safely – has signed a major manufacturing deal.
On paper, defined discipline-specific suppliers can look organised. However, every additional supplier introduces another handoff, and every handoff creates another point where time, quality, communication and accountability can be lost.
Very rarely does growth not surface because an OEM lacks ambition. Shortcomings arise because operating models built to support such ambition don’t evolve quickly enough.
Recent weeks have brought two important industry moments into sharp focus, concluding that demand for AI and automation is rising, but investment, skills, and long-term thinking must follow.
For decades, one question has sat at the heart of operational strategy for machine builders and OEMs: make or buy? It’s a familiar debate and it isn’t the wrong question by any means, but perhaps it is an incomplete one.
In most machine building businesses, change is still treated as an exception. A late-stage drawing revision, component substitution, or wiring tweak discovered during build. Each one is handled, resolved, and signed off. And then everyone moves on. But what if that’s the wrong way to think about it? What if change isn’t the disruption to the system but the system itself?
