Britain is spending more on defence than at any point since the Cold War — and that’s before the government commits an expected £18 billion more in its long-awaited Defence Investment Plan shortly. We have set our sights on sovereign defence capability, against the backdrop of successive geopolitical crises. But each flashpoint – Ukraine, the conflict in the Middle East – exposes the same structural vulnerability.
While Britain has ambitions to be a self-sufficient defence manufacturer, additional investment has limited mileage unless we also build the infrastructure that allows us to be independent. Ultimately, Britain is still over-reliant on the manufacturing capabilities of other countries, and at the mercy of global supply chains when we need independence the most.
The problem begins at component manufacturing, which is critical to our production capacity. Many think manufacturing means assembly – big sheds where aircraft and ships come together. Britain’s real vulnerability, and its real potential, lies in our ability to produce components and leverage the disaggregated network of tens of thousands of small suppliers making the actual parts. It is where most of the economic output of manufacturing comes from, and it is what almost nobody in Westminster talks about.
In the last few decades, we unloaded our capacity to manufacture consumer goods, making our way to a full-fledged service economy. But when consumer manufacturing was offshored, Britain hollowed out the shared component supplier base that defence and aerospace also rely on. That drove up costs, leaving us with subscale suppliers not suited to meet surges in demand. A fragile supplier base for our most critical industries.
So now in the UK, the component manufacturing supply chain that turns defence spending into actual capability is fragmented, ageing, and not built to scale. The average machine shop owner-operator is 65 years old. Lead times run to 12 weeks, at best. Forty percent of orders carry a delay or fault. These are not the characteristics of a supply chain, or more accurately called our industrial base, capable of meeting the high demand for drones, missiles and naval components.
The solution to our manufacturing woes lies in our history, specifically in the war effort. Britain’s shadow factory scheme of the late 1930s didn’t attempt to consolidate aircraft production into a single facility. It franchised a proven production model out to manufacturers who already had the floor space and the workforce — Austin, Rover, Rootes — replicating it simultaneously across the Midlands. By 1940, Britain was out-producing Germany. The supply chain was the weapon.
The same logic applies today. The fastest way to rebuild manufacturing capacity is not to construct monolithic facilities from scratch, but to replicate a proven operational model across multiple operators at once. In a defence context, that means numerous sites making the same components, in the same country, to the same standard, working towards the same national interest and reducing reliance on foreign supply chains.
The constraint on UK component manufacturing capacity is not demand – defence primes, aerospace companies and space manufacturers are looking for reliable domestic suppliers. And so too is the world. It is the absence of a scalable production system capable of meeting that demand.
A franchise model addresses this directly. Rather than building manufacturing capacity site by site, from scratch, at full capital cost each time, it allows a proven operational model – the technology, the quality systems, the business infrastructure – to be replicated across operators who bring their own premises and commitment.
Each new franchisee adds a node to the network, and each node then operates to the same standard. Capacity scales at the speed of a franchise opening, not a factory build.
This is more than a theoretical proposition. Isembard, the company I founded, currently operates factories in London, Exeter and Portsmouth, with plans to open many more before the end of the year. Every factory runs on the same operating system, holds the same certifications, and serves the same customer base. A customer placing an order gets the same quality assurance no matter where the part is made.
Britain’s manufacturing problem is solvable, and the political will exists. The government’s Industrial Strategy says the right things. The upcoming Defence Investment Plan will translate ambition into expenditure. But what has been missing is a model capable of translating that expenditure into production capacity at the speed the moment requires.
The shadow factories of the 1930s were built in three years. We do not have the luxury of a longer timeline now – franchise models are Britain’s way back to building a self-sufficient manufacturing powerhouse. Our window of opportunity to get this right is narrowing by the week, but the rewards for doing so are boundless and propel Britain firmly forwards.