It is becoming much more difficult to compete in the worldwide marketplace that we all exist in. Whether you are producing baseball bats or widgets, there is someone out there trying to produce them cheaper and quicker than you. But the question is if they are building a superior part? For some buyers, it doesn’t matter, cheaper is good enough even if the product doesn’t last as long. It is bizarre and regrettable, but cheaper has become the slogan and the word of choice for many buyers and organizations. Yes, less expensive is better, but less expensive doesn’t necessarily work out for the best. So the goal is to produce a superior, high value part and to make it of high worth to your potential customers. The makers of the parts do not establish what they makes’ worth; the buyer does. What is the customer ready to pay for your part and how much of a demand for your part is there? There are different ways to increase your revenue for your product.
You can always raise the price and pass it off to the customer. But there is a better way, a more long term approach that can raise profits and keep your organization operating lean and efficiently. It all begins with removing unnecessary waste in all aspects of your business. Waste comes in many forms and it costs every business more revenue than they would care to disclose. Waste is when employees are just hanging around, but that does not mean that there aren’t orders to be filled. It mightmerely mean that they are waiting for parts to be completed in the assembly department or it might mean that they are waiting for product from a supplier. These are procedure problems that can directly have an effect on the end product and how many you can make. When workers are loafing around, inactive and waiting for the work to come to their work station, they are not producing. They are unused and are in effect just wasting money and time. It is the same when you have machines being unused. What is the point of having a expensive mechanized machine if it is not being run for hours a day? Would it be more cost effective to do the job by hand, sell the robot and purchase a piece of machinery that will be more fruitful? What about the area that the equipment is filling, could another work station be put there and more jobs actually be completed without the machine? You can’t say that you don’t want to get rid of something because you might need it. If you are not utilizing it or it is outdated, then it is taking up valuable space and not contributing to the growth and profit of thefirm. It can be tricky to admit that getting that machine was a bad idea, but if it does not and doesn’t help build the company, then it is time to push forward and realize something that does. It is named adapting and pushing ahead.