Food and drink automation underinsured

By Phoebe Winter, October 21st 2022

The largest manufacturing sector in the UK, employing over 400,000 people, is suffering from labour shortages. The effect of Brexit and the pandemic, coupled with the drive to increase output, has resulted in food and drink manufacturers turning to robot automation.

Robot automation is growing fast

The UK has always been seen as behind the times when it comes to manufacturing technology. The Manufacturing Technology Centre (MTC) ranks the UK 24th for robot density over 10,000 manufacturing employees. However, in response to the changing climate, sales of individual robots sold to food and drink manufacturers is up. British Automation and Robot Association (BARA) data shows that sales in 2020 were up 21% from 2019, and that food and drink is now the second largest sector in terms of robots purchased annually.

Keeping up with demand

The argument for robot automation has always been based on improved productivity and quality. However, the technology is now needed just to keep up with demand and new emerging markets brought on by covid-19. Noticing a change in UK food and drink big players, Gareth Williams, Director at Rushton identifies a risk from the addition of robot automation that some may have overlooked.

 “We are finding more and more UK manufacturers are underinsured. Valuations conducted less than two years ago are already outdated and exclude any recently added technology. Meaning any new robot automation risks not being covered by insurance.”

Gareth Williams, Director, Rushton International

Manufacturers of all sizes affected

From on-farm picking to sandwiches being packed in triangular packaging, automation is being used at every step from farm to fork. One of the UK’s largest supermarkets, Morrisons is “investing in automation and robotics for production lines and grading technology, improving product flow and raw material yield, and removing repetitive manual tasks” according to the company’s annual results statement.

Many of the big names in food and drink have been using robot automation for years, yet SMEs, which make up more than half of food and drink manufacturers in the UK, are only just starting to invest. Currently 50% of SMEs are underinsured and according to Aviva 10% of SMEs would not survive if they had to pay up to £10,000 towards a claim that was not fully covered by insurance. Meaning it is particularly important for these businesses to make sure they have up to date valuations and insurance for any new technology they are investing in.

Make sure you’re covered

If you are a manufacturer looking to obtain a more up to date valuation, please contact us to find out how Rushtons can assist. As a regulated RICS firm of Chartered Surveyors, our standard model is to offer an onsite assessment and a further extension of service covering 2 years desktop updates, following which we would recommend a return to site. More about our insurance valuation services can be found here.

To discuss your valuation requirements or for further information, please contact a member of our team on 020 7702 3723 or email enquiry@rushton.co.uk.

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About Rushton International

Rushton International is an independent and impartial asset valuation and advisory firm. We specialise in the valuation of plant, equipment and buildings for insurance purposes. With our team of qualified and accredited valuers, we have the experience, qualifications and expertise to value any asset, anywhere in the world.

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