How to lower Your Manufacturing Costs
Manufacturing is an essential part of product development. Once you have designed a product and are ready to unleash it on the world, you then need someone who is able to manufacture it for you. While the costs of manufacturing are unavoidable, there are a number of simple things that you can do to reduce the financial burden of manufacturing.
In order for any business to remain competitive in the current environment, optimizing manufacturing is a critical step. Here are some simple things that any business can do to bring down their costs.
Optimize Your Process
The first thing that you need to look at when you are trying to find ways of reducing the costs of doing business is your overall process. In the case of manufacturing, the process concerns everything related to preparing for and undertaking the manufacture of your product. This means that your process will include the planning stages where you decide on what materials will be used, as well as any strategic discussions about potential manufacturing sites. All of this is on top of the work that goes into designing the product itself.
You should begin by outlining the entirety of this process and identifying areas where work from the various departments of your business converges to give you a final set of specifications for your manufacturing. Consider how decisions are made along the way, as well as what policies and procedures you have in place to ensure that the decisions being made are the right ones.
Whether it is through making practical changes that shorten the passage information has to take to get to the relevant people in the process, or through general improvements to your overall workplace culture, anything you can do that minimizes your costs and increases efficiency before the manufacturing has begun should be explored.
Alter Your Designs
If during the course of planning your manufacturing process you discover that a product is going to be considerably more expensive to manufacture than you had originally predicted, do not be afraid to alter your designs in some way to accommodate these new observations. If you get too attached to an idea and become too rigid to allow the necessary flexibility, it can hurt your project financially.
No matter how much you might be in love with your original design, don’t be afraid to excise it entirely, or reform it slightly, if it will be the difference between coming in under budget and taking a risk with your finances.
A common reason for needing to change the designs at the very last minute is because you discover that a material that you had planned to use is not actually suitable for your project. Or you might discover that it has additional costs or concerns associated with its use as a manufacturing material. If you haven’t accounted for these, they can have a considerable impact on the cost of manufacturing.
If you are planning on working with any more unusual or less common materials, you should always consult with those who have experience working with them and ensure that you entrust your manufacturing to someone with a proven track record. For example, if you are looking for a business with experience of semi-rigid coating systems, check out Industrial Polymers.
Another simple way of bringing down manufacturing costs is to rethink your approach to packaging. Not only can you potentially save a great deal of money by rethinking your packaging decisions, but by minimizing the amount of packaging on your product or making an effort to use mostly or entirely recycled materials to do it, you can then use this as a unique selling point. Consumers today prefer environmentally friendly products. If you can demonstrate to them that your product has a greener manufacturing process than your rivals, this gives you an easy victory over them.
Switching to recycled materials might allow you to save some money on your packaging. But many businesses don’t seem to realize just how much money their packaging production is costing them. Reducing the amount of packaging around your product can save you money on the cost of raw materials, but it can have implications for your finances beyond this.
For example, if reducing the amount of packaging on your product also ends up reducing the amount of space the product occupies, you will find it much cheaper to ship it once manufacturing is complete. This then gives you more room in your product budget to invest in other areas.
Negotiate with Suppliers
This is especially important if you have built a long-term relationship with any of your main suppliers. Often, they will want to keep your business, especially if your business is growing, but it also helps to have some evidence of interest from other suppliers. See what kind of quotes you can secure from rival businesses. If anyone else is willing to offer you a better deal, you can use this as a bargaining chip.
Conversely, if one of your suppliers is offering an exceptionally good service, either something that is rarely offered by their rivals, something they can do for much less money, or they produce materials and supplies of a much higher quality than their rivals, you should do whatever you need to do to retain their services.
Reducing your manufacturing costs will have a game-changing effect on the types of projects you are able to take on. Many businesses underestimate how large the potential short, medium, and long-term savings they can make by making some small changes to their manufacturing policies are. A more efficient manufacturing process won’t just be cheaper itself; it can easily form part of a larger strategy aimed at optimizing your business’ finances. For example, by adopting a different approach across the board to the way that you package your products, you could end up significantly cutting your transport costs. Next time you are evaluating your business for areas where potential financial and efficiency improvements can be made, make sure to pay particular attention to manufacturing.