What a Capacity Sharing Model Could Look Like in Practice
The idea of capacity sharing in construction is often discussed in principle.
When factories are underutilised and demand remains uneven, it is logical to ask whether capacity could be used more effectively across the sector. If one facility has available production space while another faces constraints, redistributing work appears to offer a straightforward solution.
However, while the concept is simple, its practical application is more complex.
For capacity sharing to move beyond theory, it must be understood in operational terms. This includes how it would function, when it would be used and what conditions would need to be in place for it to succeed.
Moving Beyond the Concept
Capacity sharing is not a single model.
It is a range of approaches that allow production capability to be used more flexibly across organisations. These approaches can vary depending on project type, geographic location and commercial arrangements.
At its core, capacity sharing is about improving utilisation by aligning available production with demand, regardless of where that capacity sits.
This shifts the focus from individual optimisation to system-level efficiency.
Where Capacity Sharing Could Be Applied
In practice, capacity sharing would not apply uniformly across all projects or organisations.
It is most relevant in situations where:
• Demand is uneven across regions or programmes
• Individual factories experience gaps in utilisation
• Projects require additional capacity within a defined timeframe
• Production capability exists but is not fully used
These conditions already exist within the MMC sector.
The challenge is not identifying where sharing could help, but creating mechanisms to enable it.
Forms of Capacity Sharing
Several forms of capacity sharing are already visible, although often on an informal or limited basis.
Overflow Production
One of the simplest models involves redirecting overflow work to another facility.
Where a factory reaches capacity, additional production could be allocated to a partner facility with available space. This allows projects to maintain programme timelines without requiring permanent expansion of capacity.
Component-Level Collaboration
In some cases, production could be split across facilities.
One manufacturer may produce structural components, while another produces internal elements. This approach allows different capabilities to be combined within a single project.
It also reduces reliance on a single production source.
Regional Balancing
Capacity sharing could also operate at a regional level.
Where demand is concentrated in one area but capacity exists elsewhere, coordinated allocation of work could reduce regional imbalances. This would require alignment between clients, manufacturers and logistics providers.
Short-Term Utilisation Agreements
Factories experiencing temporary gaps in workload could make capacity available to other organisations on a short-term basis.
This allows facilities to maintain utilisation without long-term commitments, while providing flexibility to those needing additional capacity.
The Role of Logistics
Any practical model of capacity sharing must account for logistics.
Production is only one part of the process. Components must still be transported, delivered and installed in alignment with site conditions.
Sharing capacity across locations introduces additional considerations:
• Transport distance and cost
• Timing of deliveries
• Site access and sequencing
• Storage and handling requirements
Without careful coordination, these factors can offset the benefits of shared production.
Effective logistics planning is therefore central to making capacity sharing viable.
Data and Visibility
One of the key enablers of capacity sharing is visibility.
Organisations need to understand:
• Where capacity exists
• When it is available
• What type of production it supports
• How it aligns with project requirements
At present, this information is often fragmented or not shared.
Improving visibility across capacity and demand requires better use of data. Organisations need to understand where production capability exists, when it is available and how it aligns with project requirements.
Research from the Centre for Digital Built Britain has emphasised the importance of digital coordination and data-led decision-making in improving performance across the built environment, particularly where multiple stakeholders and complex supply chains are involved.
Without this level of visibility, capacity cannot be effectively matched to demand.
Commercial Considerations
For capacity sharing to work in practice, commercial structures must support it.
This includes:
• Clear contractual frameworks
• Defined responsibilities for quality and delivery
• Transparent pricing mechanisms
• Protection of intellectual property
Without these elements, organisations may be reluctant to participate.
Capacity sharing must therefore be commercially viable as well as operationally effective.
When Capacity Sharing Adds Value
Capacity sharing is not a universal solution.
It is most effective when:
• Demand is uneven rather than consistently low
• Production processes are sufficiently standardised
• Logistics can be managed efficiently
• Organisations are willing to collaborate
In stable, high-demand environments, individual facilities may already operate at full capacity, reducing the need for sharing.
The value emerges in periods of fluctuation, where flexibility can reduce inefficiency.
From Individual Efficiency to System Efficiency
A key shift required is in how efficiency is defined.
Construction has traditionally focused on optimising performance at the level of individual organisations or projects. Capacity sharing introduces the idea of optimising the system as a whole.
This may require organisations to:
• Accept short-term trade-offs
• Coordinate with competitors
• Share information more openly
While this can be challenging, the potential benefits include improved utilisation, reduced downtime and greater overall stability.
The Role of Clients and Frameworks
Clients and procurement frameworks can play a role in enabling capacity sharing.
By structuring programmes in a way that allows for flexibility in production allocation, they can support more efficient use of capacity.
This may include:
• Aggregating demand across projects
• Allowing multiple manufacturers to contribute to delivery
• Encouraging collaboration within frameworks
Without this support, capacity sharing may remain limited to informal arrangements.
Conclusion
Capacity sharing is often discussed as a potential solution to underutilisation within the MMC sector. Moving from concept to practice requires a clearer understanding of how it would operate.
In practical terms, capacity sharing involves flexible allocation of production across facilities, supported by coordinated logistics, transparent data and viable commercial structures.
It is not a simple or immediate solution. It requires alignment across multiple parts of the system.
However, in a sector characterised by uneven demand and underutilised capacity, it offers a way to improve efficiency without relying solely on expansion.
If the industry is willing to engage with the complexity, capacity sharing has the potential to move from a theoretical idea to a practical tool for improving performance.