Automation and robotics have the potential to solve many of the challenges facing manufacturers today, from rising labour costs and staff shortages to the need to improve production efficiency and build resilience. But although the case for investment in industrial automation is strong, in the current climate of corporate belt-tightening, many automation projects don’t make it off the drawing board because of the perceived high upfront investment.
Credit: FANUC
With 2025-2006 the most expensive period on record for UK businesses, a growing number of manufacturers are turning to automation as a strategy for future-proofing against inflation and maintaining a competitive edge.
Increasingly, capital decisions are evaluated in terms of ‘freeze, flee or build’. Under this model, there are three options: pausing or deferring a decision until key assumptions stabilise (freeze); redirecting capital away from an area of exposure (flee); and accelerating an investment to capture an opportunity or establish a competitive advantage (build). All too often, automation projects end up being ‘frozen’ – not because the rationale is flawed but because they are deemed unaffordable or non-urgent at a time when cash is in short supply. This can lead to considerable inefficiencies and strategic disadvantages, putting manufacturing businesses in a vulnerable position.
Therefore, when constructing a justification for investing in automation, it is important to demonstrate why the project should be treated as a priority, and how it will be financed. By shifting the focus from well-worn arguments to reframing the economics of robotics – and showing why the cost of waiting is usually higher than the cost of taking a decision now – project managers can make the case for immediate investment irrefutable.
Here are six points that manufacturers can draw on to build an automation investment proposal that stacks up…
1. Robots are more affordable than they’ve ever been
The cumulative inflation rate in the UK over the past 20 years (2006-2026) is approximately 70-80%, based on Consumer Prices Index (CPI) data. Yet over this same timeframe, the average purchase price of an industrial robot has only increased by 20%. Investing in equipment that has registered price growth lower than the general rate of inflation can be a strategic move, as it effectively makes it cheaper in real terms. If robot prices are rising by 1% whilst the overall inflation rate is 3%, you are purchasing a productive asset that is decreasing in relative cost compared to other investments.
2. Multiple options open up access to finance
Historically, most automation projects were funded via high street bank loans. Today, there are multiple financing options, some of which offer far more flexibility. Recent years have seen some robotics integrators partnering with finance providers to offer flexible funding options, such as staged payments and asset finance, to help manufacturers invest in technology without heavy upfront costs. Asset-based lending (ABL) has also become more common as a flexible alternative to traditional high-cost bank loans. This allows businesses to acquire new equipment or tech by using assets such as receivables or inventory as collateral. We would advise any company that is embarking on an automation project to speak to their integration partner or OEM supplier about what finance is available.
3. Assurance schemes build trust for lenders
Trust in robotic systems is growing, driven by a maturing assurance ecosystem, and this confidence is starting to filter through to lenders. Earlier this year, Automate UK launched the UK’s Robot Integrator Standard in association with BARA. Designed to ensure that integrators follow best practice, the standard provides assurance of safe, high-quality and reliable robotic and vision solutions, thereby reducing the risk associated with automation projects.
FANUC UK has also built up its own network of trusted authorised system integrators – partners we have selected to work with for their ability to provide specialised, low-risk automation. It is expected that such schemes will translate into more favourable financing arrangements for borrowers through reduced risk for lenders.
Credit: FANUC
FANUC UK has also built up its own network of trusted authorised system integrators – partners we have selected to work with for their ability to provide specialised, low-risk automation.
4. Transfer of costs from CapEx to OpEx
Whilst robotics investments have traditionally been structured as CapEx – a large outright purchase of a piece of equipment – over time, service has become an increasingly critical element of these projects. As automation technology has advanced, service has gone from being a post-installation afterthought to a fundamental pillar of success; most installations today incorporate simulation, training (of AI systems as well as human operators) and ongoing servicing and support. From a financial perspective, this has created an opportunity to move some project costs from CapEx to OpEx, converting them into ongoing, manageable and flexible expenses. This strategic decision can help make automation more affordable by reducing the upfront investment, preserving cash flow and enabling costs to be apportioned to different cost centres.
5. Robots are moving to maintenance-free
Traditionally, it has been accepted that annual maintenance costs for an industrial robot will run to 3-10% of the original purchase price. This is dependent on the size of the robot, with maintenance costs for larger robots typically coming in at the lower end of this range. Finance providers have accounted for these costs by bundling them into monthly payments. However, technological advancements such as predictive maintenance, accelerated life testing and greaseless components are moving robots into a new ‘maintenance-free’ paradigm.
Among robot manufacturers, FANUC is leading the way here, with its renowned reliability and market-leading 8-year maintenance-free promise. This is making robots more affordable over their lifetime – a saving that will soon be reflected in the structure of finance deals as robots can be guaranteed to be maintenance-free for the duration of the financial agreement.
6. Automation helps reduce manufacturing overheads
The argument that investing in automation allows businesses to produce more with less has never been stronger. We are entering an era of precision manufacturing with technologies such as robotics, AI and sensors enabling real-time monitoring and optimisation of production parameters, quality metrics, material usage and energy consumption. The net result is that manufacturing has the potential to be leaner, more productive and more resource-efficient than ever before. These advancements are strengthening the economic case for automation. For example, FANUC’s systems feature AI-driven diagnostics, advanced power regeneration and IIoT solutions that enable intelligent energy recovery, reduce waste and improve uptime.
The right time to invest
With 2025-2006 the most expensive period on record for UK businesses, a growing number of manufacturers are turning to automation as a strategy for future-proofing against inflation and maintaining a competitive edge. Reduced risk for lenders is translating to more favourable packages from finance providers; technological advancements that have improved robot productivity, reliability and resource utilisation are driving a structural decline in cost per unit of output; and in real terms, robots are getting cheaper. For manufacturers, this makes automation an increasingly powerful lever for expanding margins and scaling production efficiently and flexibly.