How To Increase Your Manufacturing Profit Margins

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If you’re in the manufacturing game, then you’ll already be aware that it’s an expensive business to be in. The profit margins aren’t quite as high as you’d like them to be, and it can feel like you’re putting in a lot of effort for not that much reward. But maybe it doesn’t have to be this way. Like in every other business, it’s possible to increase your profit margins in a number of ways, and once these have all been combined, you might find that they’ve made a noticeable difference to your bottom line. Below, we take a look at a few handy changes you can make to boost your operations and ultimately earn more money.

Work Out an Efficient Routine

You can get caught into a way of doing things, which sticks just because you’re used to it. However, it’s good practice to ask yourself whether you’re working this way because it’s the best, most effective way of working…or you’re doing it because this is how its always been done. Take a look at your operations, or, if you don’t feel too informed about what you should be looking for, gave an outside expert do it. You might be making a simple mistake and not even know it!

And Update Your Equipment

Your equipment is key to your success. If you’re using old machines which take twice as long to do things as the newer machines, then it doesn’t take a rocket science to see that this isn’t good for business! Keep your equipment well-serviced, and then, when it’s obvious they’re beginning to break down, replace them altogether. Also, have a think about the useful equipment that you don’t currently possess. Things like cost-effective roller conveyor systems can make the whole factory process much smoother and save a lot of time, for example. If you have the best equipment, you’ll find it easier to work efficiently. Simple!

Work With Your Employees

You’re just pulling the strings. It’s the workers on the shop floor who are doing the work. So work with them, first by making sure that they have all the training and support they need to do their job well. Second, by asking for feedback. What do they think slows down their work? What do they need to work at their best? Ultimately, if your employees can work well, then your company will benefit.

Negotiate With Suppliers

You’re not going to be working alone at your factory. You’ll have supplies and partners that you work with. But are you getting the best deal possible from them? It’s not always wise to stay loyal to companies you work with! Don’t be afraid to walk away if you’re not getting the best deal from them!

Crunch Them Numbers

And finally, go over those numbers, again and again. It’s nearly always possible to save money without compromising the quality of your work or the happiness of your workers. Have an eagle eye, and make small savings wherever you can.

4 Secrets To Manufacturing Success

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Manufacturing is an unpredictable industry, which is why plenty of people turn the other way. There’s nothing wrong with it, but it’s easier to strike a deal through a third party in China than it is to develop products.

You’re different, though. The idea of playing God and bringing a concept to life is fascinating. Outsourcing manufacturing is not an option. It’s only on the table if the table comes from the factory downstairs.

Still, deciding to be a huge hit isn’t a walk in the park. Success is like respect – it’s earned, not given. Like all things, there are cheat codes that can help and four of them are listed underneath.

Network

There’s a lot of favor asking required in this job. Unfortunately, being an expert doesn’t guarantee anything. To ensure the sales match the products, you have to be able to strike a great deal. For instance, one way to stand out from the crowd is to undercut the competition. If the products are high quality and cheaper, then they’ll fly off the shelves. To do this, you have to source affordable materials at low rates. And, only contacts can get the job done.

Location

Real estate and manufacturing have one thing in common: it’s all about the location. A typical business has to think about foot traffic and brand awareness, whereas you aren’t as concerned. They’re important, but people can’t walk in off the street if they see something they like in the window. Location is essential for manufacturers because of transport links. Drivers have to be able to load easily and unload materials to kick-start the creative process. Being next to a railway line helps too. The wrong location will rough up the process and provide obstacles that are hard to hurdle.

Equipment

It goes without saying that the right tools make the job easier. A semiconductor equipment manufacturer needs photonics, microfluidics and MEMs and power devices. Without them, the whole operation breaks down to a grinding halt. However, there’s another reason to embrace technology and it has to do with gambling. Nope, this isn’t money-related, although equipment can make and save the firm cash. It’s the fact that if you don’t take the risk, then you may end up losing ground in the race to the top. Mostly, it’s better to have it on board even if the tech doesn’t do anything.

Choose The Right Factory

We’ve already spoken about location, so let’s move onto the building itself. The right factory is essential for a variety of reasons, from money to flexibility. But, it’s also important to have the space needed to compete. There is nothing worse than trying to cram in a group of people next to heavy machinery. No one can do their job correctly without thinking “is that metal bolt going to hit me in the head?” The ramifications from a health and safety standpoint are pretty huge also. The building has to be ready for the here and now while thinking ahead to the future.

Are you ready to be a hit? What’s the plan of attack?