With the pound sterling now at significantly lower levels against all major currencies, Herga’s export book has been expanding - even in the short time since the referendum - with US, and European customers taking full advantage of lower component purchasing costs. With the US dollar trading substantially higher than the pound, and that trend seemingly set to continue, Herga says British exports for manufactured products that are sourced in the UK are set to thrive. As a supplier to major medical equipment OEMs, which are dominant in the USA and Germany, Herga believes its sterling adjusted costs and its international distribution support network will appeal.
UK-based OEM’s that have relied on purchasing switching components from overseas are also reportedly finding Herga’s pricing appealing. The stronger currencies have risen by an average of 10% since Brexit. That, coupled with US dollar-linked fuel costs for long-distance shipping, has meant that many UK manufacturers are being squeezed, and are turning to UK-sourcing to regain their margins.
Herga recently invested £60k in production mould tooling for a new footswitch that was to be placed with a Far East supplier but was awarded instead to a UK company. Whilst costs were an important consideration, the faster delivery and local service and support from the UK supplier were said to be driving factors. Significant investment in plant, equipment and business systems improvements have continued since Herga’s acquisition by the Variohm Holdings Group in 2013.
But Herga’s optimism is not just about the pound. The indications are that Post-Brexit, the UK can begin to redress its imbalance between the service and manufacturing industries. The company claims that British manufactured high-technology equipment is sought after world-wide and can gain substantially if future conditions outside the EU permit.
As a manufacturing SME, Herga is looking towards those pro-leave politicians that campaigned on the basis that there will be less red-tape and consequent reduced costs. Like many companies in a similar position, government initiatives for technology investment will be vital in the future.
“Herga Technology’s optimism is clear”, explained managing director, Roy Moffatt. “We have continued to invest in people and equipment but also have made substantial business performance and systems changes that have made Herga a much greater force in the global market for footswitches and hand controls.”
