UK

The Nation's Noodles Maker Symington's Relocates Manufacturing Process From China To Leeds

13/03/2013 16:57 GMT | Updated 14/03/2013 08:32 GMT

Food producer Symington's - the manufacturer behind Ragu sauces and Aunt Bessie's - is relocating the manufacturing process for its noodles back to the UK, after rising costs in China meant it was cheaper to make the student staple in Leeds.

Henrik Pade, business development manager at Symington's, told the FT the move was driven by the need for quicker response times – when a retailer requests more stock they do not want to wait for a container ship to trawl across the sea – and cost.

"We can produce for roughly the same cost today in Yorkshire as we are out of China," said Pade. "If you go back in time, it would probably have been 30-35% less."

Symington's is creating 50 new jobs in the UK by relocating 'The Nation's Noodles' manufacturing process.

After years of businesses relocating services and manufacturing overseas, known as off-shoring, Britain is now seeing a mass relocation from several different business sectors.

In 2011, Santander, the Spanish bank that owns that used to be Abbey, Alliance & Leicester and parts of Bradford & Bingley, moved all of its call centres back to the UK after receiving heavy criticism for poor customer service from its centres in Bangalore and Pune in India.

And last year, Tony Caldeira, owner of a large Merseyside-based cushion and furnishings maker Caldeira, received national television coverage with his two-year mission to bring his processes out of China and back to the UK.

He once saw the loss of jobs to China as an inevitable fact of life. "Just before China came 'on side', to push their globalisation agenda and sell products around the world, we realised the Chinese companies were able to sell the products more cheaply to us than we could make them," he told the Huffington Post UK.

"At that time - around 2003, 2004, I didn't have any choice but to close the UK factory and take the business to China."

So why the big move back to Blighty?

It's largely a combination of macro-economic factors, including China's maturing labour force, combined with the British shoppers' desire for understanding where their goods have come from and a push for local produce.

The continued rise in the value of the renminbi (the Chinese currency), the steady increases in shipping rates and differentials in tax rates between finished goods and raw materials, plus the cost of basic fabrics, has led to the UK looking competitive again.

And Chinese wages have soared, meaning the idea of outsourcing for cheap labour is now fast becoming outdated.

The same worker Caldeira could pay £50 per month in 2004 now earns £250, he told HuffPost UK in 2012.

The recession has also meant retailers are not willing to buy in bulk and sit on huge amounts of stock, so the cost efficiencies from buying masses of stock are no longer attractive.

Caldeira hired 20 workers to jobs in Merseyside.

The EEF, the UK manufacturers' association, told the FT there was a "fairly consistent trickle" of manufacturers returning some production to the UK: a survey carried out in 2011 showed one in seven bringing some work back onshore.

Lee Hopley, chief economist at EEF, said companies were coming home because there was now more focus on quality and shortened supply chains.

"Companies want to make sure the whole supply chain is robust and resistant to supply shocks because they have seen significant disruptions. They are competing on service and quality and less on pure cost," she added.