It is becoming more and more difficult to compete in the worldwide marketplace that we all exist in. Whether you are making cars or widgets, there is someone out there trying to make them less expensively and faster than you. But the question is if they are building a superior product? For some consumers, it doesn’t matter, cheaper is good enough even if the part doesn’t last as long. It is bizarre and regrettable, but cheaper has become the catchphrase and the word of choice for many consumers and businesses. Yes, less expensive is better, but less expensive doesn’t always work out for the best. So the object is to produce a good, high value item and to make it of high value to your clients. The makers of the parts do not establish what they makes’ value; the buyer does. What is the consumer willing to pay for your part and how much of a demand for your product is there? There are different ways to increase your profit for your product.
You can always increase the price and pass it off to the buyer. But there is a better way, a more long term method that can increase revenue and keep your organization running lean and efficiently. It all begins with removing unnecessary waste in all areas of your organization. Waste comes inlots of forms and it costs every company more revenue than they would care to confess. Waste is when workers are just standing around, but that does not mean that there aren’t orders to be filled. It might just mean that they are waiting for parts to be completed in the painting department or it might mean that they are waiting for product from a supplier. These are method issues that can directly influence the end product and the speed at which you can produce. When employees are hanging around, idle and waiting for the work to come to their station, they are not productive. They are unused and are in essence just wasting money and time. It is the same when you have machines standing quiet. What is the point of having a expensive automatic machine if it is not being run for hours a day? Would it be more efficient to do the job by hand, sell the robot and purchase a piece of equipment that will be more productive? What about the room that the machine is filling, could another work spot be put there and more work actually be done without the robot? You can’t say that you don’t want to get rid of something because you might want it. If you are not utilizing it or it is old, then it is taking up room and not contributing to the development and profit of thebusiness. It can be difficult to admit that getting that equipment was a bad idea, but if it does not and doesn’t help build the business, then it is time to push forward and discover something that does. It is named adapting and going forward.