Directory Image
This website uses cookies to improve user experience. By using our website you consent to all cookies in accordance with our Privacy Policy.

Tips for running a successful manufacturing business

Author: Cynthia Madison
by Cynthia Madison
Posted: Oct 21, 2019

Setting up a manufacturing business, be it big or small, requires a lot of financial and moral commitment. You need to find a location, purchase the right equipment and hire people that will help you grow your company.

Manufacturing businesses are considered to be amongst the hardest type of businesses to set up because they usually require a lot of investment and take more time until they start generating profit. But this does not mean that succeeding in this field is impossible. Once the business is established, you will start developing partnerships and connections, and things will start shaping up. But what can you do to ease up the process of setting up your business?

Start with research

There is no way of establishing and running a successful business, be it in retail, manufacturing or any other industry, without proper market research. By doing this, it will be much easier to understand the market, identify problems and come up with solutions that are going to separate your business from your competitors.

The manufacturing sector is wide and englobes multiple industries, such as electronics, automotive, industrial equipment, metal pressing any basically, any industry that involves a production line. The first thing you need to do is establish where in this huge sector you want your business to fit. Then, by conducting market research in that particular field, you will be able to find out what the market needs and how can you tailor your business to satisfy those needs.

Research needs to be conducted constantly because the industry is highly competitive and dynamic. This UK metal pressing company, for example, is an established name in the industry, precisely because they constantly adapt to the requirements of the market.

Find the right location

When it comes to manufacturing, location is extremely important. Not only in terms of geographic area but also in terms of building structure. Again, the nature of your business will determine what type of building you should be looking for. If you plan on installing and using heavy machinery, you will need a building that has strong floors, which can withstand high traffic, heavy loads and equipment.

You also need to take into consideration levels of noise and pollution, which can require the factory to be situated relatively far from the city, as well as warehouse space, to determine the size of the building.

Consider if you are also going to put together a showroom to display your products, or if this can be done solely in the online. You will also need enough space for offices, employee parking, and other facilities.

Find the best-suited suppliers

When looking for suppliers, you need to take into consideration a few important aspects, such as reliability, price, and transportation. Many businesses have turned towards overseas suppliers, as prices can be significantly lower than those of local suppliers. If you decide to go overseas with your supply chain, take into consideration shipping costs as well. Even though the overall product price may be lower, shipping costs can bring the total amount quite close to what you would pay if you were to purchase locally.

At the same time, you need to expect the unexpected and take into consideration that sometimes, shipments may be delayed, dues to external factors, such as weather or other emergencies. In this case, you need to make sure that your business won’t be affected. One way to do so is to ensure you have a safety stock, which you can use in such situations. But make sure the stock is not too high, as it can turn out to be counterproductive, which leads to the next piece of advice.

Manage Inventory

Inventory management will play a key role in determining the productivity and financial management of your business. There are two ways inventory management can go wrong: either ordering too many materials and keep them laying around, which means the money you invested will not generate profit, or order too little and not being able to fulfill orders.

In the beginning, you may find yourself struggling with such issues, but it is highly important that you find a solution soon. Some suppliers may require a specific order size, to cut down on shipping costs or receive discounts. Ask if you can divide that into smaller, more frequent orders, and keep the same benefits. They may not agree from the beginning, but in time, as you establish a closer partnership with them, you may be able to get all sorts of deals that will benefit your business.

Implement the methodology of the 5S’s

The Japanese are very familiar with this method, as they believe it to be the best way to increase the productivity of any manufacturing business. By implementing this rule, you will not have any more lost hours and your employees will be able to work without being interrupted by various issues.

The methodology is divided into the following:

  • Seiri (Sort): ensure that no unnecessary objects are crowding the working area and may end up affecting productivity. Classify each object by frequency of use and ensure that the most used items are easy to access.

  • Seiton (Set): instruct your employees that everything needs to have its own place, and once someone is done with using it, they should always put it back where it belongs to. This way, no one will have to spend too much time looking for something they need.

  • Seiso (Shine): keeping a clear workplace will improve productivity and promote the right mindset. Nobody likes to work in a dusty and dirty place.

  • Seiketsu (Standardize): have a clear product recipe that anyone can see and access. This way, they won’t have to roam around asking what needs to be done and where they need to look.

  • Shitsuke (Sustain): make a habit out of all the points above and ensure that your employees know this. Set out clear rules and policies that need to be followed, and begin cultivating your company culture.

About the Author

Cynthia Madison is a young blogger and economics and marketing graduate. She writes about home, lifestyle and family topics and is a senior contributor to popular niche publications.

Rate this Article
Leave a Comment
Author Thumbnail
I Agree:
Comment 
Pictures
  • Guest  -  5 months ago

    thanks inventory management

  • fb-157799735287171  -  4 years ago

    Suggest my underdeveloped website governmentjob.pk

    1
Author: Cynthia Madison
Premium Member

Cynthia Madison

Member since: Jun 30, 2017
Published articles: 95

Related Articles