Overhaul your manufacturing floor: Top 20 tips for making your company more profitable and efficient

Posted on 18 Feb 2019 by Tim Brown

Manufacturers have a heavy burden of processing raw materials, a process that is costly and can result in a lot of waste and by-product.

On the path to a clean and efficient manufacturing floor - stock image courtesy of APS
On the path to a clean and efficient manufacturing floor – stock image courtesy of APS

Take the fashion industry, for example; an increasing spotlight is being shone on textile manufacturers for the enormous amount of clothing waste that is generated on an annual basis. Factor in the rise for sustainability and emphasis on environmental protection and more financial burden is being placed on manufacturers than ever before. Manufacturers in all sectors need to not only create large orders but do so in an ethical and environmentally sustainable way. However, if you cannot keep your price low enough, your clients will likely leave you for another company that cuts corners.

Thankfully, there are a variety of ways to boost profits, even in this changing economic climate. The only option you should not take amongst these options is the choice to reduce safety measures and environmental protections. With the way government regulation and consumer demand is going, it will soon become non-negotiable to operate with full consideration to the environment and those who are working for you.

By getting ahead of these trends and making your company into an ethical choice for brands to use, you can instead acquire more business and minimise risk all at the same time. You won’t need to fork out millions to upgrade your facilities all at once, and can instead make those changes piece by piece, but first, you will want to follow this guide to reduce your current costs, boost profits, and have more than enough left over to reinvest.

Start first with organisation

If your manufacturing floor is in any way disorganised, you must immediately work to rectify this issue. Not only is disorder time consuming to work around; it also poses a health risk. Those manufacturers who employ mostly robotic employees and machines will likely already have this section completed, but if your plant is older, or manned mostly by human employees, you will want to look into ways to streamline their operations through organisation.

1.    Clear out clutter

Go through and clear out all the clutter in your offices and plants, everything, from debris in the corner to old papers, to even unused tools. Everything that doesn’t have a purpose in your company must go.

2.    Digitise your information

All information should be digitised so that you can finally start making use of it. Data management programs are incredibly powerful and can work towards cutting time by automating admin tasks and by generating automatic reports that provide you with greater insight into your operations. You will also benefit from substantial cost savings by going paperless.

3.    Create smart storage solutions

Shadow boards are very effective when it comes to safely storing and locating tools needed on the floor. Invest in them so that your tools are always in the same place and that your employees’ safety is more secure.

Do more with your data

As you have now digitised your data (and ideally rid yourself or stored offsite all of their paper originals), you can now do more with what you have.

1.    Power of cloud computing

Cloud computing is powerful because it allows for instantaneous updates to files across the world. Your office employees can communicate instantaneously without directly phoning your manufacturing floor, and so on.

2.    Finding the right data management software for your company

The right data management software is one that has been designed specifically for your industry and can be customised to suit your needs. Once you have the right one, you should be able to automate many admin tasks and generate reports that can help you direct your company into greater financial success.

Reduce operating costs

Now that your company is more efficient, what is next is to work towards reducing your operating costs. This is the single best way to improve profit margins because you are in greater control over these costs than you are sales. In an ideal world, the money that you will save in making these changes will cover the extra costs associated with ethical and environmental protections, but that won’t always be the case. Either way, by reducing your operating costs and even finding ways to make money from your company’s by-product you will be able to offset the costs associated with sustainable production.

1.    Find ways to make your company more efficient

Auditing your company, installing data management programs, shadow boards, and other such processes will help reduce costs by merely reducing the amount of time that they take. When your company runs efficiently, there is less down time, and more production time, allowing you to boost your profits in sales.

2.    Go paperless

If you can try to, go paperless. Going paperless will help you save an astronomical amount of money, especially if you previously printed off copies and letters on a large scale. Using the right data systems and cloud computing can make paper obsolete in your industry, allowing you to save on paper, printing, and transportation of these letters.

3.    Make money from your waste

Manufacturers often have waste at the end of the production cycle. Taking raw materials and transforming them into something else often leaves something behind. By finding out innovative ways to either reuse this by-product or selling it on to another company you can boost your profits on something that previously only cost you money to dispose of. Sell your metal scrap, for example, to a recycling plant to bring in extra money.

Alternatively, you could also work to create a closed loop in your company. You will need to work with your suppliers and clients to do this, but by reusing raw materials, you can reduce costs and benefit from a very attractive selling point. 

4.    Reduce utility costs

Reducing your utility costs can help you save a lot of money, and with wind farms now cheaper to build than operate a coal plant, more affordable energy is on the horizon. Switch to a reusable energy company and find ways to reinvest into your own company so that your machines are more energy efficient than before.

Improve your qualifications

Reducing costs and improving efficiency is great for boosting your profit margins, but if you genuinely want to succeed and weather the changing economic storms, you will need to be at the forefront of your field and obtain more clients. One of the best ways to kill two birds with one stone is to improve your own personal qualifications and knowledge.

1.    Go back to university

MBAs are very useful for business owners, but for manufacturers, you will want to look for something more specialised. For engineers, for example, there are online masters in engineering management available to obtain. This degree can help you thrive in your industry, and give you a greater understanding of business management and engineering than ever before. It is also entirely possible to achieve in a year while maintaining your current position due to its online learning elements.

2.    Read reports and journals

Stay up to date with industry trends long after your degree is achieved by subscribing to relevant journals and reports. This is how you will direct your company towards the future and prepare for it accordingly.

3.    Stay up to date with news

The news is also a great place to look. Keep up to date with news stories that are relevant to your company. Pay particular attention to financial and legal news, to ensure that your company always remains above the law.

Build up your team’s strengths

While you work on improving your own knowledge and qualifications, you should find ways to improve your team’s abilities as well. You can do this by:

1.    Share your knowledge

What you learn is something that they can learn. So as you are studying for your own Master’s, try to create easy to understand PowerPoints that go over the basics of what you are learning. You don’t need to text your employees or give them assignments, but simply make the information available to them so that everyone can be as on top of the industry as you are.

2.    How to get more out of your meetings

Try to bring people from all different aspects of your company so that more diverse discussions could be had. Having an IT representative converse with your Marketing representative can result in some truly innovative adverts. Having someone on your manufacturing floor talk with your HR department can help ensure that everything is safe and that your worker’s wellbeing is cared for.

3.    Build up teamwork

Try to build up teamwork through a variety of different exercises. Go on a retreat, or even just take a team out to an Escape Room as a bonus for doing great work. By bonding outside of the workplace and working together towards a common goal, you can help improve their ability to work together without them noticing.

4.    Reinforce safety measures

Manufacturers must always put safety as a priority, so make it easy for employees of any level to report damages or concerns to upper management. When such a report comes in, have someone look at it. If you can, try hiring an outside consultant. Then, if he deems it safe and signs off on it, you are less liable in the future.

Speakers' Corner at Smart Factory Expo 2018 - image courtesy of The Manufacturer.
Engaging events such as Speakers Corner at Smart Factory Expo 2018 provide a fantastic learning opportunity to help manufacturers improve their operations.

Improve your marketing efforts

The previous steps are all designed to make your company stronger and more efficient than ever before, but to truly boost profits, you will also want to bring in more clients who are even willing to pay more for your services. It can be tricky, especially when the brands you partner with want nothing more than to increase their own profit margins at every given opportunity.

Thankfully, with globalisation, you have a lot of potential businesses to partner with, but to get their attention you will want to:

1.    Market your company

It is a huge mistake to assume that, as a manufacturer, you cannot market your company, especially when social media and Google’s algorithms have become masters at identifying demographics. You can easily market your services and manufacturing floor to brands around the world. You could even narrow down who you market to so that only those brands who are looking to improve their supply chain see your advertisements.

2.    SEO

Invest in SEO, and you have a long-term marketing plan in place. The goal of search engine optimisation is, after all, to get you to the top of Google. By investing in its practices and narrowing down what keywords you want to rank on to niche results, you improve your chances of being seen by the right brands.

3.    Make use of events

Events in your industry are a great opportunity to get your name out there, make new connections, and even secure new clients. Attend as many as you can from conferences, to trade shows, to even workshops or other events held by industries you wish to partner with.

4.    Build a strong referral program

The best advertisement you can get is a referral, so create a program that encourages small brands especially to refer others to you. This way you can build up a vast client base without extra effort.

5.    Be transparent

Show your manufacturing floor. Be honest about your numbers and your efforts towards improving your company. You don’t need to have everything perfect right off the bat, but what you do need is to prove that you are committed to changing your business model to one that suits the evolving consumer demand for sustainable and ethical business practices. Doing this will make it easy for brands who wish to improve their own supply chains to choose you, as they can refer to your company with pride.

Overhauling your manufacturing company won’t be easy, but by taking the initiative now before you are mandated by law can help you save money and actually bring in new clients who are responding to their customer’s demand for more sustainable production. Over 90% of consumers believe businesses should step up for the sake of the environment, and government regulation won’t fall far behind. Make the changes now so that your company can thrive in the future.