Small manufacturers in the east of England are to make the most of a strengthening UK economy by focusing on domestic markets for future growth, according to research.

Nearly two thirds (65pc) of companies questioned in the latest Manufacturing Advisory Service (MAS) Barometer feel that increasing sales at home offered the best chance of expansion.

The findings compare to 32pc of companies which felt it was best to focus on boosting export performance to ensure long-term growth.

Meanwhile, in a sign of increasing confidence, 82pc of manufacturers in the east expect collective turnover and staffing levels to increase by 60pc over the next four years.

The MAS Barometer is research compiled from 113 small manufacturers across the east of England, which employ more than 3,000 people and have turnover in excess of £187m.

David Caddle, area director of the MAS, said: 'There is significant confidence in the domestic marketplace at the moment, a further signal that the recovery has taken hold.

'We've seen unrivalled investment in the UK automotive industry and that is cascading down the supply chain and creating new opportunities. Our reputation for low carbon advancement should also be another growth sector and I'm sure our manufacturing SMEs will be in line to take advantage of major infrastructure projects, such as High Speed Rail.'

He continued: 'As part of the long-term focus, we also asked respondents about their biggest strengths, with the quality of senior leadership teams (74pc) coming out on top, followed by robust strategy (67pc) and innovative products (66pc).

'It was surprising to discover that the biggest challenge is effective marketing (73pc), whilst access to skills and finance were the next major concerns. We will work with partners like GrowthAccelerator and SEMTA to help SME manufacturers overcome these challenges.'

Business Minister Matthew Hancock said: 'This is yet more good news for British manufacturing which shows a more balanced recovery is really taking hold now. These many thousands of jobs that promise to be unlocked in manufacturing will help families across the country and that's the whole point of our long-term economic plan.'

The results maintain the positivity seen in previous findings, with 65pc of companies increasing sales in the last six months and 73pc expecting to grow between now and the end of the year – a 13pc and 15pc improvement respectively on this time last year.

More than half of firms (54pc) are looking to recruit and create new jobs, which is a 16pc rise on 2013.

Mr Caddle continued: 'Despite recent economic surveys reporting a slight dip in manufacturing performance, it appears the smaller firms are still confident of growing, especially when you compare the key performance indicators with the figures from last summer.

'Everything we monitor, including sales, future growth, jobs and investment, are all up across the board so we can see the short-term outlook is very positive. Thanks to our specific focus this quarter, we also know there is longer-term confidence and the areas of concern manufacturers need support to address.'

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