It is getting more and more difficult to compete in the global marketplace that we all exist in. Whether you are making cars or widgets, there is somebody out there trying to produce them cheaper and faster than you. But the question is if they are making a superior product? For some buyers, it doesn’t matter, cheaper is better even if the product doesn’t last as long. It is weird and unfortunate, but cheaper has become the catchphrase and the word of choice for many buyers and businesses. Yes, less expensive is better, but cheaper doesn’t necessarily work out for the best. So the object is to produce a superior, high value item and to make it of high value to your potential customers. The makers of the items do not decide what they makes’ value; the customer does. What is the buyer prepared to pay for your service and how big of a demand for your product is there? There are different ways to raise your profit for your product.
You can always elevate the price and pass it off to the customer. But there is a better way, a more long term method that can increase profits and keep your organization running lean and efficient. It all starts with eliminating unnecessary waste in all parts of your company. Waste comes in many forms and it costs every organization more revenue than they would care to disclose. 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 finished in the painting department or it might mean that they are waiting for parts from a vendor. These are procedure concerns that can directly influence the end product and how many you can produce. When employees are sitting around, unused and waiting for the job to come to their area, they are not productive. They are unused and are in effect merely wasting cash and time. It is the same when you have machines sitting quiet. What is the point of having a costly automatic machine if it is not in use for hours a day? Would it be more cost effective to do the process by hand, sell the robot and purchase a piece of machinery that will be more productive? What about the space that the equipment is taking up, could another work station be put there and more jobs actually be completed 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 valuable space and not contributing to the growth and profit of the company. It can be difficult to admit that buying that equipment was a bad idea, but if it does not and doesn’t help grow the company, then it is time to move on and discover something that does. It is named adapting and moving forward.