It is becoming much harder to compete in the global marketplace that we all exist in. Whether you are building hair dryers or widgets, there is somebody out there trying to produce them less expensively and faster than you. But the question is if they are building a superior part? For some people, it doesn’t matter, cheaper is good enough even if the part doesn’t last as long. It is bizarre and unfortunate, 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 objective is to produce a first-rate, high quality item and to make it of high value to your customers. The producers of the product do not decide what they makes’ worth; the consumer does. What is the consumer willing to pay for your part and how big of a demand for your part is there? There are different ways to raise your earnings for your product.
You can always raise the price and pass it off to the consumer. But there is a better way, a more long term method that can raise revenue and keep your company working lean and efficient. It all begins with removing unnecessary waste in all areas of your business. Waste comes in many forms and it costs every business more revenue than they would care to admit. Waste is when workers are just standing around, but that does not mean that there aren’t orders to be made. It mightmerely mean that they are waiting for parts to be completed in the assembly department or it could mean that they are waiting for product from a supplier. These are process problems that can directly influence the end product and how many you can make. When employees are loafing around, unused and waiting for the job to come to their area, they are not producing. They are unused and are in essence simply wasting cash and time. It is the same when you have machines standing idle. What is the point of having a expensive 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 machine and purchase a piece of machinery that will be more productive? What about the room that the equipment is filling, could another work station be put there and more work actually be completed without the machine? You can’t say that you don’t want to do away with equipment because you may need it. If you are not using it or it is old, then it is taking up room and not contributing to the expansion and profit of theorganization. It can be hard 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 move forward and discover something that does. It is called adapting and moving ahead.