Tool Manufacturing in the UK Industry Market Research Report now updated by IBISWorld

Share Article

Tools, which are now often attached to machines, are used to work, cut, shape, move and join materials like metal and wood. Today, the tools manufactured by companies in this industry are used in almost all sectors of the economy. The total UK market for tools will be worth an estimated £1.37 billion in 2012-13, of which an estimated £806.1 million, or 58.8%, will be satisfied by imports. The UK operations of tool manufacturers are expected to generate revenue of £1.19 billion in 2012-13 (down 0.3% on revenue in 2011-12). Revenue of the Tool Manufacturing industry in 2012-13 is expected to be virtually the same as industry revenue in 2007-08 (0.0% annualised growth). Exports will fall, mainly as a result of a shift of production activity from the UK to low-cost countries. Domestic demand for tools will be subdued and adversely affected by weak levels of economy-wide industrial production and construction activity. North Sea oil and gas drilling activity will be weak over much of the period, although it is expected to pick up in the longer term. Average unit selling prices for many tools will decrease in real terms. However, IBISWorld expects that domestic firms will increase local sales, due to a decrease in import penetration helped by a weaker pound. Industry revenue is forecast to marginally increase in the five years through 2017-18. Domestic demand for tools will grow at a slow rate in the five years through 2017-18, partly due to a shift of metalworking, woodworking and plastic profile production to low-cost countries. Imports are forecast to increase their share of the local market and to exert pricing pressures on local manufacturers. The real value of industry exports will grow at a slow pace and will not be helped as some companies relocate production to jurisdictions where market growth is fast or where labour costs are low. For these reasons, industry research firm IBISWorld has updated its report on the Tool Manufacturing industry.

IBISWorld Market Research

IBISWorld Market Research

The industry struggles as production is increasingly moved offshore

Tools, which are now often attached to machines, are used to work, cut, shape, move and join materials like metal and wood. Today, the tools manufactured by companies in this industry are used in almost all sectors of the economy, particularly in manufacturing, mining, construction and agriculture industries. Repair people are also a market for tools. Interchangeable tools for machine tools, such as drills, punches, turning tools and blades, are also included in the industry. The total UK market for tools will be worth an estimated £1.37 billion in 2012-13, of which an estimated £806.1 million, or 58.8%, will be satisfied by imports. The UK operations of tool manufacturers are expected to generate revenue of £1.19 billion in 2012-13 (down 0.3% on revenue in 2011-12). Exports are expected to be worth £623.8 million in 2012-13.
Revenue of the Tool Manufacturing industry in 2012-13 is expected to be virtually the same as industry revenue in 2007-08 (0.0% annualised growth). Exports will fall, mainly as a result of a shift of production activity from the UK to low-cost countries. According to IBISWorld industry analyst Nigel Fitzpatrick, “domestic demand for tools will be subdued and adversely affected by weak levels of economy-wide industrial production and construction activity”. North Sea oil and gas drilling activity will be weak over much of the period, although it is expected to pick up in the longer term. Average unit selling prices for many tools will decrease in real terms. However, IBISWorld expects that domestic firms will increase local sales, due to a decrease in import penetration helped by a weaker pound. Industry revenue is forecast to marginally increase in the five years through 2017-18. Domestic demand for tools will grow at a slow rate in the five years through 2017-18, partly due to a shift of metalworking, woodworking and plastic profile production to low-cost countries. Imports are forecast to increase their share of the local market and to exert pricing pressures on local manufacturers. The real value of industry exports will grow at a slow pace and will not be helped as some companies relocate production to jurisdictions where market growth is fast or where labour costs are low.
The Tool Manufacturing industry displays a low level of market share concentration due in part to the diverse range of products manufactured in this industry. In 2012-13, the industry's four largest firms are estimated to account for approximately 15% of industry revenue. Fitzpatrick adds, “concentration within the industry has increased in recent years, following the acquisition of smaller players by international players and the relocation of some manufacturing operations to countries where manufacturing costs are low”. National Oilwell Varco is the only major player in the industry.

For more information on the Tool Manufacturing industry, including latest industry trends, statistics, analysis and market share information, purchase the full report from IBISWorld, the nation’s largest publisher of industry research.

IBISWorld industry Report Key Topics

Companies in this industry manufacture tools, except power-driven hand tools.

Industry Performance
Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle
Products & Markets
Supply Chain
Products & Services
Major Markets
Globalisation & Trade
Business Locations
Competitive Landscape
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
Major Companies
Operating Conditions
Capital Intensity
Key Statistics
Industry Data
Annual Change
Key Ratios

About IBISWorld
Recognised as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on many UK industries. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in London, IBISWorld serves a range of business, professional service and government organisations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.co.uk or call (020) 3008 6568.

Share article on social media or email:

View article via:

Pdf Print

Contact Author

Gavin Smith
Visit website