It is becoming much more difficult to compete in the worldwide marketplace that we all live in. Whether you are producing baseball bats or widgets, there is someone out there trying to make them less expensively and quicker than you. But the question is if they are producing a superior product? For some buyers, it doesn’t matter, cheaper is better 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 buyers and organizations. Yes, less expensive is better, but less expensive doesn’t always work out for the best. So the goal is to make a good, high value item and to make it of high worth to your customers. The makers of the product do not decide what they makes’ worth; the consumer does. What is the buyer ready to pay for your service 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 consumer. But there is a better way, a more long term approach that can boost profits and keep your organization operating lean and efficiently. It all starts with eliminating unnecessary waste in all parts of your company. Waste comes innumerous forms and it costs every organization more money than they would care to admit. Waste is when workers are just standing around, but that doesn’t mean that there aren’t orders to be made. It might just mean that they are waiting for parts to be finished in the electrical department or it might mean that they are waiting for parts from a supplier. These are process issues that can directly affect the end product and how many you can produce. When employees are loafing around, inactive and waiting for the work to come to their work station, they are not useful. They are idle and are in effect 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 in use for hours a day? Would it be more cost effective to do the job by hand, sell the machine and buy a piece of equipment that will be more industrious? What about the space that the machine is filling, could another work station be put there and more labor actually be done without the robot? You can’t say that you don’t want to get rid of tools because you might need 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 hard to admit that purchasing that equipment was a bad idea, but if it doesn’t work and doesn’t assit grow the company, then it is time to move on and find something that does. It is called adapting and pushing ahead.