It is getting much harder to compete in the worldwide marketplace that we all exist in. Whether you are producing hair dryers or widgets, there is somebody out there trying to make them less expensively and quicker than you. But the question is if they are building a better product? For some people, it doesn’t matter, cheaper is good enough even if the product doesn’t last as long. It is bizarre and unfortunate, but cheaper has become the motto and the word of choice for many consumers and businesses. Yes, cheaper is better, but less expensive doesn’t necessarily work out for the best. So the objective is to build a first-rate, high value product and to make it of high value to your potential customers. The makers of the parts do not determine what they makes’ worth; the customer does. What is the consumer ready to pay for your service and how big of a demand for your part is there? There are different ways to raise your profit for your goods.
You can always raise the price and pass it off to the customer. But there is a better way, a longer term approach that can increase earnings and keep your organization running lean and efficient. It all begins with removing unnecessary waste in all parts of your business. Waste comes in many forms and it costs every company more revenue than they would care to disclose. Waste is when workers are just standing around, but that doesn’t mean that there aren’t orders to be filled. It mightsimply 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 procedure issues that can directly influence the end product and the quantity that you can produce. When employees are loafing around, idle and waiting for the job to come to their area, they are not productive. They are under used and are in essence simply wasting money and time. It is the same when you have machines being quiet. What is the point of having a fancy automated 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 buy a piece of machinery that will be more productive? What about the room that the equipment is taking up, could another work area be put there and more jobs actually be done without the equipment? You can’t say that you don’t want to get rid of equipment because you might want it. If you are not utilizing it or it is obsolete, then it is taking up room and not contributing to the growth and profit of the company. It can be difficult to admit that getting that machine was a bad idea, but if it does not and doesn’t assit build the business, then it is time to move on and find something that does. It is called adapting and going forward.