Stop Fabrication
Do You Really Want To Make It?
Is it time to stop manufacturing your own windows and buy them in? Paul Tranter, National Sales Manager for Sierra Windows, explains how a reliable fabricator can take away the headaches of production, whilst the resulting financial savings can be re-invested to help the company focus on the retail elements of its business.
The increasing financial pressure in a difficult, competitive market is driving more of the smaller window companies to re-examine the reasoning behind their original decision to fabricate for themselves. It’s hard enough juggling the production process – issues with machinery maintenance and breakdown, labour and managing stocks of materials barely scratch the surface – with the need to look after existing customers as well as going out to get new business. But the added stress of a fluctuating order book and the need to make ends meet is tempting many to consider stopping fabrication and concentrate on supply and installation.
At Sierra we have looked at the whole production process and calculated an average cost saving, based on producing 100 frames a week, for a company that decides to buy in frames rather than manufacturer its own. A one off saving of up to £19,400 can be achieved from sale of machinery, returning or selling stocks of profile and hardware, and by not having work in progress in the factory. A further annual saving of around £69,200 for production costs, materials, wages, maintenance etc can be achieved by buying in. With savings like this, companies can start focusing on selling their products and increasing profit.
Machinery break downs and shortage of reliable, skilful staff can cause delays during manufacture and this leads to the need for rescheduling in the factory, problems regarding quality and ultimately customers are let down. In a business where your reputation, good and bad, spreads quickly, keeping existing customers satisfied is as important as finding new ones. And having the right products to install on the date you promised is as important to your business as it is to the homeowner who is expecting you on a particular date, and has scheduled days off work to be there. Everyone knows the frustration of waiting in for a delivery or tradesman that never arrives!
In addition to these production problems, orders may fluctuate from one week to the next. This leads to big overtime bills during busy weeks and staff kicking their heels during slow periods.
Large stocks of materials pose another dilemma for fabricators. Minimum orders from systems suppliers mean large quantities of ‘dead money’ in the warehouse, and fewer opportunities to optimise usage. The rising cost of raw materials and transport has to be absorbed and this is particularly difficult when competing on price with other installers. Disposal of waste profile also presents a problem, both financially and practically.
All these difficulties in the factory leave little time to concentrate on actual sales and promoting the company. No wonder some smaller concerns are finding it difficult to break even. What is needed is a hassle-free switch to a reliable fabricator with the capacity to supply whatever is needed, on time, in full and to the very highest quality.
So how do you go about it? First thing is to assess the real cost of your factory by looking at the following key areas. This will determine if it is still cost effective to fabricate yourself or whether the time has come to shop around for a fabricator to suit your needs.
- How much unused material do you have in stock that is unlikely to ever be used and therefore will not generate any revenue?
- Do you achieve maximum optimum material use, or is there too much waste on the factory floor and in the skip?
- Are your customers demanding manufacturing standards and product accreditations that you cannot afford to invest in?
- Is your cash flow constantly affected by the rising costs of manufacturing and overheads?
- Are you spending too much on machinery maintenance and renewal every year?
- Are your labour costs far too high compared with actual output?
- Would you find it easier to order everything you need, frames, glass, hardware etc, from just one supplier?
Once the decision has been made to stop fabricating, the rest is easy. Staff can be retrained and refocused to use their valuable knowledge of production as an indispensable selling tool. Your profile company should be informed as soon as possible, and stocks run down or returned. Machinery can be sold off.
This leaves time and the resources to concentrate on the retail aspects of your business. The factory space could be converted to provide a showroom where customers can spend time considering how your products can enhance their home, assisted by your informative staff. You can also concentrate on lead generation and the marketing materials to back up any advertising campaigns you plan. Your fabricator should be able to advise you of the best approaches to take with these projects and give you the help and support you need to get going.
What’s in it for you? If you choose a reliable supplier like Sierra Windows, you can be sure of high quality products, made to recognised manufacturing standards, complying with the latest building regulations and carrying all the relevant accreditations. Every cost is fixed, so you will know exactly what you will be paying, and you will benefit from significantly reduced overheads. What’s more your orders will be delivered regularly, at a time you can set your watch by. And we offer a market-leading marketing and sales support package tailored to your individual requirements.
Without the worry of production problems, you can turn your attention to growing your business, concentrating on generating and following up leads, and you may even find yourself with more free time to enjoy!
