More than four in five (84%) small and mid-sized UK manufacturers experience unplanned downtime at least once a month, with nearly one in five (18%) reporting disruption weekly, according to research by Aviva.

The survey of 500 senior decision-makers and insurance buyers found that supply-chain disruption was the most commonly cited cause, identified by 22% of respondents. Cyber incidents followed at 17%, while equipment failure and staff shortages were each cited by 14%.

The impact is widespread, with 78% of manufacturers saying current risks are causing moderate to significant disruption to their operations. Light manufacturers were particularly affected, with 89% experiencing downtime at least monthly.

Despite the exposure, businesses are taking steps to manage supply-chain risks. More than a third (37%) regularly review supplier performance, while the same proportion monitor wider market and geopolitical developments. A further 35% use supply-chain management software.
The research also highlights demand for greater support from insurers. More than a quarter of respondents (27%) would welcome help with business continuity and resilience planning, while 28% want assistance identifying underinsurance and gaps in cover.

The cost of replacing critical equipment is another concern, with 79% somewhat or very worried about the expense of replacing machinery, plant or equipment following a breakdown, fire or other major event.

Chris Andrews, director of global risk management solutions at Aviva, said: “Manufacturers want to be able to focus on growing their businesses, investing and serving their customers. When something unexpected stops production, attention can quickly shift to getting the business back up and running.

“That’s why resilience matters. A supplier can fail to deliver, a cyber incident can take systems offline or a key machine can stop working. Businesses need to understand what could bring production to a halt and have a clear, tested plan for how they would respond.

“That means looking closely at critical suppliers, customers, machinery, systems and skills, testing business continuity plans and understanding how long key equipment could take to replace. Firms should also check that their sums insured reflect current replacement costs and that their business interruption cover provides a suitable recovery period following an insured event such as a flood or fire.”

---