If I built a factory..
Discussion
that needed 10,000 people to work there, had a world class product and was somehow free from union representation would it be a success?
Is the major stumbling block in this country the cost of wages? Piss poor management?
If Toyota/Honda/Mini/Nissan can make a success of it why isn't there a British equivalent?
Is the major stumbling block in this country the cost of wages? Piss poor management?
If Toyota/Honda/Mini/Nissan can make a success of it why isn't there a British equivalent?
Because for the most part they got to start with a sensible budget, greenfield sites with good transport links, new staff with no history of carbuilding and no established union presence, and customers waiting for cars; in short no baggage. If BL had been allowed to go bust instead of being dripfed taxpayers' money and the receiver bulldozed redundant, inefficient or obsolescent plants and sold on the newer, more productive parts, it might still exist today.
raf_gti said:
that needed 10,000 people to work there, had a world class product and was somehow free from union representation would it be a success?
Is the major stumbling block in this country the cost of wages? Piss poor management?
If Toyota/Honda/Mini/Nissan can make a success of it why isn't there a British equivalent?
There are plenty of British equivalents, it's just that they don't base the factory in the UK.Is the major stumbling block in this country the cost of wages? Piss poor management?
If Toyota/Honda/Mini/Nissan can make a success of it why isn't there a British equivalent?
The real problem is that the wage bill for 10,000 people will be an absolute fraction overseas and you'll have lower taxes and lots of other benefits.
From my experience, the biggest problem facing UK factories is the 'British disease' ie Unionised workers who refuse to do anything beyond their job description 'cos that ain't anyfink to do wiv me mate' and sit on their arses doing nothing rather than working with the company to help it succeed. They don't seem to understand that working hard for their company ensures their job security, instead they see them as an entity with unlimited funds and question why they're not paid more for unskilled labour, and finally when the company fails it's the managements fault..... Rover I'm looking at you 
On top of this I'd say that green taxes are a huge obstacle (carbon credits coming in for large energy users) and I can forsee more to come in the future.
On top of this I'd say that green taxes are a huge obstacle (carbon credits coming in for large energy users) and I can forsee more to come in the future.
raf_gti said:
Is the major stumbling block in this country the cost of wages? Piss poor management?
You might also want to add MASSIVE business rates to that list of hindrances.Business rates are at least £2 per sq. ft. of factory space. For 10,000 bods, unless you;re going to insert them inside one another, Russian doll stylee, I'd say could need anything between 60 to 500 sq. ft. (or more even) per employee, depending on how big a cat you need to swing. So let's be generous and say that's a minimum of 600,000 sq. ft.; so you'll pay the state at least £120,000 p.a., £10k per month, every month, from start-up, irrespective of whether you make a profit.
See the problem?
You'll get grants and concessions for this that and the other, but it's all bulls
t that skews the playing field for certain lucky/qualifying businesses. Broadly though, that's how hard they'll want to shaft you, jsut for the cheek of trying to be an entrepreneur and providing employment.Digga said:
ou might also want to add MASSIVE business rates to that list of hindrances.
Business rates are at least £2 per sq. ft. of factory space. For 10,000 bods, unless you;re going to insert them inside one another, Russian doll stylee, I'd say could need anything between 60 to 500 sq. ft. (or more even) per employee, depending on how big a cat you need to swing. So let's be generous and say that's a minimum of 600,000 sq. ft.; so you'll pay the state at least £120,000 p.a., £10k per month, every month, from start-up, irrespective of whether you make a profit.
See the problem?
You'll get grants and concessions for this that and the other, but it's all bullst that skews the playing field for certain lucky/qualifying businesses. Broadly though, that's how hard they'll want to shaft you, jsut for the cheek of trying to be an entrepreneur and providing employment.
Agreed, a factory I did work for employed 20 workers and were paying £75k a year on business rates alone (remember that a business gets nothing in return for paying this). Also the machinary in a factory is generally quite chunky so if you're employing 10k workers that's a lot of machinary.Business rates are at least £2 per sq. ft. of factory space. For 10,000 bods, unless you;re going to insert them inside one another, Russian doll stylee, I'd say could need anything between 60 to 500 sq. ft. (or more even) per employee, depending on how big a cat you need to swing. So let's be generous and say that's a minimum of 600,000 sq. ft.; so you'll pay the state at least £120,000 p.a., £10k per month, every month, from start-up, irrespective of whether you make a profit.
See the problem?
You'll get grants and concessions for this that and the other, but it's all bulls
t that skews the playing field for certain lucky/qualifying businesses. Broadly though, that's how hard they'll want to shaft you, jsut for the cheek of trying to be an entrepreneur and providing employment.How much are you selling the product for? ( are you going expensive top of the market or cheap and cheerful)
Who are your customers?
what about research and development costs?
What about competitors?
market share of your product?
How much of your profits are you going to re invest for future products?
legal costs?
advertising costs?
Material cost fluctuations
etc etc
there is so much more involved than a building and workers
Who are your customers?
what about research and development costs?
What about competitors?
market share of your product?
How much of your profits are you going to re invest for future products?
legal costs?
advertising costs?
Material cost fluctuations
etc etc
there is so much more involved than a building and workers
The wage differences aren't the real issues in the UK compared with elsewhere, unless you're talking about something that is very labour intensive.
Business rates have already been discussed and you'll pay twice that in rent. Place your factory somewhere a country really wants to welcome you and you'll pay vitually nothing. Add in the additional costs of HR, H&S & energy etc here and it's that which makes the difference.
Business rates have already been discussed and you'll pay twice that in rent. Place your factory somewhere a country really wants to welcome you and you'll pay vitually nothing. Add in the additional costs of HR, H&S & energy etc here and it's that which makes the difference.
raf_gti said:
that needed 10,000 people to work there, had a world class product and was somehow free from union representation would it be a success?
Is the major stumbling block in this country the cost of wages? Piss poor management?
If Toyota/Honda/Mini/Nissan can make a success of it why isn't there a British equivalent?
Even if you did build such a successful business here in the UK, someone would come along and point out that you could double your profits by shipping it overseas. What you gonna do, say, no, wont do that, best keep these important jobs in the old country, or ship it all over seas and buy yourself a nice little island in the sun witht he increased profits...?Is the major stumbling block in this country the cost of wages? Piss poor management?
If Toyota/Honda/Mini/Nissan can make a success of it why isn't there a British equivalent?
Did I read somewhere that Dyson is even offshoring his design department now?
spikeyhead said:
Add in the additional costs of HR, H&S & energy etc here and it's that which makes the difference.
This is a big part of the reason imo.Also, in places like Japan, it seems the 'Corporation' is part of your life in a lot of circumstances. They are an extended family. People are 'proud' to be working for the coporation they do.
Here in the UK, you get the feeling that everybody thinks they are owed something. They aren't there to help the company grow....they are performing a job which is a means to an end.
Granted, that is not the case everywhere.....and some smaller companies do have the feeling of an extended family...but you look at larger companies and most people don't have that same feeling.
But again...in places like Japan, the companies seem to give a lot more back to the community that their workforce derives from.
I guess it's a different business philosophy.
Edited by Spiritual_Beggar on Thursday 24th February 23:13
Is this view of Unionised workers being lazy stes something of a blinkered view? Perhaps in factory environments there are other factors as to why people have to Unionise........
However I feel that could warrant a thread in itself.
Anyhow it cannot be applied across the board. The people at my workplace in the Union work exactly like the rest of us (though whether we work hard is questionable
)
tes something of a blinkered view? Perhaps in factory environments there are other factors as to why people have to Unionise........However I feel that could warrant a thread in itself.
Anyhow it cannot be applied across the board. The people at my workplace in the Union work exactly like the rest of us (though whether we work hard is questionable
)I find this http://en.wikipedia.org/wiki/Automotive_industry quite surprising.
We produce less cars than Canada, Spain or Iran but more than Italy.
Germany produces more than Britain and France put together.
It's clearly not just low wages. Access to markets helps and I guess that's why Canada is so high.
I would say the UK simply got it wrong in the 70s for mass car production, as did France and Italy. Germany has established itself as a regional hub of the European car industry while Spain, Czech and a few other hotspots have made themselves attractive locations to actually screw cars together owing to their cheap and available land and relatively low wage costs for skilled workers.
It would seem Brazil has done the same thing in South America, producing more cars than even it's large population can buy (surely?)
Blaming the unionisation per se is a bit empty when unions are far stronger in most European countries, though they certainly didn't help matters, and the charge that British unions are/were particularly militantly political rather than simply negotiating the best deal possible for their members is possibly a valid one.
We produce less cars than Canada, Spain or Iran but more than Italy.
Germany produces more than Britain and France put together.
It's clearly not just low wages. Access to markets helps and I guess that's why Canada is so high.
I would say the UK simply got it wrong in the 70s for mass car production, as did France and Italy. Germany has established itself as a regional hub of the European car industry while Spain, Czech and a few other hotspots have made themselves attractive locations to actually screw cars together owing to their cheap and available land and relatively low wage costs for skilled workers.
It would seem Brazil has done the same thing in South America, producing more cars than even it's large population can buy (surely?)
Blaming the unionisation per se is a bit empty when unions are far stronger in most European countries, though they certainly didn't help matters, and the charge that British unions are/were particularly militantly political rather than simply negotiating the best deal possible for their members is possibly a valid one.
Spiritual_Beggar said:
Here in the UK, you get the feeling that everybody thinks they are owed something. They aren't there to help the company grow....they are performing a job which is a means to an end.
Granted, that is not the case everywhere.....and some smaller companies do have the feeling of an extended family...but you look at larger companies and most people don't have that same feeling.
This, we have lots of small and very sucessful SME's however our large UK derived industry is a shambles and a legacy of the 70's and 80's when the state bailed it out and had weak management that were too scared to deal with the 'it aint in my job description mate'. This is worse in ex-state owned places (ie ex British Steel) in my experience.Granted, that is not the case everywhere.....and some smaller companies do have the feeling of an extended family...but you look at larger companies and most people don't have that same feeling.
When I was trying to motivate people as a young graduate I got 'they will never close us mate, these losses are made up those management f
kers don't know what they are talking about'. 6 months later 800 people made redundant and the site was closed.
10,000 workers would either be a hugely manually intensive industry, or one you would scale up with robots to keep your wage costs low as a percentage of overall costs.
If it's the first case you wouldn't think twice about putting it in Vietnam or inland China. UK average wage ~22k, Vietnam skilled worker wage including board and lodging etc about 2k. So that's an immediate pot of cash of 200m pounds a year extra. That pot easily pays for the best people locally, and all the extra shipping costs.
If it was 10,000 plus robots you would be talking about something on the scale of a large car factory, in the range of 300,000 vehicles a year, around 15% of all UK new car sales. If you're on that scale you can negotiate a custom deal from the local government - land price, reduced rates, tax subsidies, etc etc.
So no reason why you couldn't make a go of it in the second case if your conditions were true (world class product etc), but that's only because you're in an artifically beneficial situation compared to every small entrepreneur who has to pay all those costs in full.
One of the problems with the workforce, as previous posters indicate, is that in general the unskilled, untravelled, part of the UK (and US and western European) population has absolutely no awareness or comprehension of what they are up against in the global labour market.
If EastCoronationDale was replaced with a nightly 30 minute show called "what Mr Cheung built today in his 10 hour factory shift before going to 2 hours of English lessons and then another 2 hours of studies towards his engineering degree and then another hour of rehearsals for the Factory Drama Group's production of "Hey - maybe I should give all this up and become a community outreach worker; a comedy in two acts" we might have some hope of improving the UK economy.
If it's the first case you wouldn't think twice about putting it in Vietnam or inland China. UK average wage ~22k, Vietnam skilled worker wage including board and lodging etc about 2k. So that's an immediate pot of cash of 200m pounds a year extra. That pot easily pays for the best people locally, and all the extra shipping costs.
If it was 10,000 plus robots you would be talking about something on the scale of a large car factory, in the range of 300,000 vehicles a year, around 15% of all UK new car sales. If you're on that scale you can negotiate a custom deal from the local government - land price, reduced rates, tax subsidies, etc etc.
So no reason why you couldn't make a go of it in the second case if your conditions were true (world class product etc), but that's only because you're in an artifically beneficial situation compared to every small entrepreneur who has to pay all those costs in full.
One of the problems with the workforce, as previous posters indicate, is that in general the unskilled, untravelled, part of the UK (and US and western European) population has absolutely no awareness or comprehension of what they are up against in the global labour market.
If EastCoronationDale was replaced with a nightly 30 minute show called "what Mr Cheung built today in his 10 hour factory shift before going to 2 hours of English lessons and then another 2 hours of studies towards his engineering degree and then another hour of rehearsals for the Factory Drama Group's production of "Hey - maybe I should give all this up and become a community outreach worker; a comedy in two acts" we might have some hope of improving the UK economy.
Corsair7 said:
raf_gti said:
that needed 10,000 people to work there, had a world class product and was somehow free from union representation would it be a success?
Is the major stumbling block in this country the cost of wages? Piss poor management?
If Toyota/Honda/Mini/Nissan can make a success of it why isn't there a British equivalent?
Even if you did build such a successful business here in the UK, someone would come along and point out that you could double your profits by shipping it overseas. What you gonna do, say, no, wont do that, best keep these important jobs in the old country, or ship it all over seas and buy yourself a nice little island in the sun witht he increased profits...?Is the major stumbling block in this country the cost of wages? Piss poor management?
If Toyota/Honda/Mini/Nissan can make a success of it why isn't there a British equivalent?
Did I read somewhere that Dyson is even offshoring his design department now?
1. Speed of the line - The Nissan plant in Sunderland is the fastest in Europe iirc, the workers are very impressive to watch, by building cars so quickly the profitability of the UK plant increases, 1 car per line per minute, and there are 2 lines. (more cars built for the same wages)
2. Build quality, believe it or not British built cars are winning awards all over the world for the build quality, MINI, Qashqai etc.
3. Distance to ship the vehicles/time in transport. As Europe is one of the largest markets in the world it takes far less time to ship and order out.
4. Exchange rates. The Yen is very strong currently and as a result it's too expensive to build cars in Japan. Sure India and China are cheaper on man power than the UK, but when you add points 1,2 and 3 together they are still stuggling to compete.
spikeyhead said:
Place your factory somewhere a country really wants to welcome you and you'll pay vitually nothing. Add in the additional costs of HR, H&S & energy etc here and it's that which makes the difference.
100%.Which is sad, because as Mojoo says, British workers, even the unionised ones, are still pretty dilligent and talented. There are people out there looking for work that new (or expanding current) businesses could provide if the environment was friendlier.
Mojooo said:
Is this view of Unionised workers being lazy stes something of a blinkered view? Perhaps in factory environments there are other factors as to why people have to Unionise........
However I feel that could warrant a thread in itself.
Anyhow it cannot be applied across the board.
tes something of a blinkered view? Perhaps in factory environments there are other factors as to why people have to Unionise........However I feel that could warrant a thread in itself.
Anyhow it cannot be applied across the board.
And people wonder why british workers are members of militant unions and japanese workers arn't?
When all that matters to the company is the bottom line profit and nothing else, don't wonder why all that matters to the worker is his job description and nothing else.
Japanese workers feel they belong to the company because the company doesn't decide to fk off to bangalore because people will work for £3 a day.
But never mind, you get your "island".
Seriously, company bosses in this country need to take a long look in the mirror.
(and no I don't vote labour)
When all that matters to the company is the bottom line profit and nothing else, don't wonder why all that matters to the worker is his job description and nothing else.
Japanese workers feel they belong to the company because the company doesn't decide to f
k off to bangalore because people will work for £3 a day.But never mind, you get your "island".
Seriously, company bosses in this country need to take a long look in the mirror.
(and no I don't vote labour)
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