Understanding the Scottish Textile Industry productivity challenges

The research aimed to analyse the productivity of the Scottish textiles sector and the challenges to productivity improvement. This report provides a detailed examination of productivity challenges faced by the sector and makes recommendations for addressing these challenges.

The methodology consisted of an online survey of textile companies, literature review and consultations with 29 textile companies and 9 support providers/stakeholders.

The research confirmed that the vast majority of Scottish textile companies view productivity as being vitally important to competitiveness and, as such, it is an increasing area of focus for textile manufacturers. Seven factors were identified as influencing productivity performance: market development and increased sales; investment in capital equipment; systematic use of modern methods of manufacturing; skills and motivation of the workforce; leadership skills and structured management practices; product and service innovation; and process and organisational innovation. Feedback from companies confirmed that these areas are the focus of productivity improvement initiatives they have implemented in the recent past, the most common being investment in production machinery. However, it was found that the textile manufacturing sector has relatively low productivity (as measured by gross value added (GVA) per head) compared to other manufacturing sectors. A number of reasons were cited for this, including: lower than average wages; more labour intensive processes; seasonality of demand; lower levels of capital investment; the relative predominance of small, domestically owned, family run companies; and GVA per head figures don’t take account of part-time working, which is more prominent in the textiles sector. Twenty four challenges faced by the textile sector in improving productivity were identified by companies and support providers. These include: seasonality of products; lack of specific skills; limited time and resources; gaps in the supply chain; depreciating asset base; limited ability to invest; potential loss of skills through retirement; and lack of awareness of new technologies and opportunities. It was noted that there are a large number of existing support providers and products already in place to address many of these, however.

A set of recommendations to address the challenges identified were made, including continued investment by the sector to build a more productive capital asset base and support domestic and export market growth. Where support providers and products already exist, recommendations focus on raising awareness and creating the motivation to engage. Of all the opportunities identified, it was recommended that involving actions to increase the uptake of existing services should be a priority, particularly where complexity and additional resources are relatively low. Five productivity action themes were proposed as a basis for a focused agenda, which align with the seven factors identified during the research: market development and sales; investment; leadership and skills; manufacturing; and innovation. It was also suggested that consideration be given as to how the Industry Leadership Group ensure the sector is kept up to date with the implementation of the manufacturing action plan for Scotland, to help identify opportunities for the sector to be involved and learn from the experience of other manufacturing sectors.