Businesses in the region which export benefitting from slump in the pound

Gary Seale, founder of Telford-based iDry, believes his company is six per cent better off on its net profit at the current rate of sterling.

The firm, which makes 15 per cent of sales in dollars, makes full body hot air dryers that are used by people with mobility issues, the elderly and luxury hotels.

A disastrous day for the pound on Monday led to consternation among many economists and also helped Labour take its biggest poll lead over Tories for more than 20 years. The record low of 1.0327 against the US dollar came after traders were spooked by the Government's economic plans.

The collapse of the pound means people importing goods or raw material from overseas are having to pay more. There are warnings that oil and gas, sold at wholesale in dollars, will become even more expensive. Breweries have also warned of an increased in the price of beer because hops are often imported.

But Gary, overseeing a firm that exports, is seeing the benefit of the low pound. For every item he exports, he is now getting more back. He now also aims to source component parts from the UK so that the complications of importing are removed.

“From a selfish point of view, I’m over the moon with the drop as it makes us a lot more attractive to overseas purchasers,” said Gary, who has set ambitious targets to hit sales of 25,000 units in 2023.

“The bigger picture is how we can use this current situation to review our supply chains and look at where we can source more UK content. I’ve learned to our cost, how unreliable chasing the low-cost part can be and it’s a mistake I’ll never make again.”

Gary is referring to a crucial ‘fan’ component that he successfully placed back with Birmingham manufacturer Tooling 2000 after being held to ransom on costs and lead times by his previous Chinese supplier.

“Cheap in China, doesn’t mean cheap anymore. The quality isn’t there, the lead times are elongated and the actual landing price – when you factor in logistics and regulations – means it is often just as competitive to have it made in the UK. That’s the approach we are now committed to.

“If we all aim towards a more UK reliant supply chain, we can also make a positive difference to our carbon footprint, dramatically reducing the amount of CO2 used during transport.”

Telford food processor Bridge Cheese said the current currency crisis could offer short-term export opportunities but ultimately result in increased prices at home.

The company sources a wide range of cheese and dairy ingredients from across the UK and Europe which are then used to produce a range of cheese products for customers such as restaurant chains, food manufacturers and wholesalers as well as overseas markets.

Managing director Michael Harte said the current weakness of the pound would create export opportunities for the dairy industry to secure extra short-term spot business but that Bridge Cheese was looking to secure long-term sustainable business.

“This is key to us and this is what we are working on. UK milk volumes are down year-on-year which means that there is less raw material available against a backdrop of the UK already being a net importer of dairy products in 2021," said Mr Harte.

“Demand for dairy products including cheese has remained strong in recent years and therefore the industry is reliant on imports to meet overall demand within the UK and the weakness of the pound will mean an increase in the cost of imported products.

“Extra demand arising from new export opportunities coupled with an increase in costs of imported dairy products is in the short-term likely to lead to further pressure of increased prices for dairy products that are consumed in the UK.”

The pound's tumble makes it more expensive to import goods and commodities, such as food, clothes, oil and gas. But a fall also makes British companies more competitive when they export around the world. A cheaper pound means that it is cheaper for people around the world to buy British goods and services.

Weakness in the pound also makes the UK an attractive place for international investment, particularly from the US.

Sterling rallied a little after a big fall on Monday, but economists have warned it could still fall to parity with the dollar this year for the first time.

The Treasury has moved to settle the markets with the promise of a Budget next spring.

Anton Gunter, managing director of Telford-based freight forwarding company Global Freight Services, said while weakening of the pound would create financial uncertainty in the economy, it presented a huge opportunity for exporters.

He said: “Now more than ever businesses should be looking to expand their export markets and get their products out there particularly into the US.

“We have a solid track record of producing high-quality sought-after goods here in the UK and weakening of the pound will means that those products will now become even more attractive to overseas buyers from a price perspective.

“It puts businesses in a prime position to capitalise on international trade and those who have considered exporting but have not yet taken the plunge should be seizing the opportunity.

“For companies relying on overseas imports however, the outlook isn’t so rosy unfortunately and they can expect to face higher bills in the short to medium-term.”