Some years back, our shop had a sales line that went like this: "We can build your project faster, cheaper or better pick any two."
While it was always said in a somewhat joking manner, there was, in fact, an underlying seriousness to the statement. Surely, for a client to get all three things on their job would probably mean we'd lose money. If we had to build it faster, that would mean we'd be working longer, possibly even overtime. If we were asked to do the work cheaper, we'd be cutting into our profit, perhaps into our hard costs. And, of course, if the project had to be better, then it would inevitably take more time to build.
Well, things have changed. All three faster, cheaper and better are now required, if your shop is to continue to make a profit.
The way automobiles have evolved is a good example of what I'm talking about. It wasn't that long ago that electric locks and windows were a fairly expensive option. However, while this feature is not quite standard these days, many people buying a new car simply expect the vehicle to have them. And, has the price of the car really increased a huge amount because of the upgrade? Not really. I'd bet, in fact, that the cost of a basic car hasn't changed dramatically, even though the features have certainly improved.
Overnight delivery companies have changed our perception of speed, too. It's no longer incredible that I can get a copy of this column from the West Coast to the East Coast within 12 hours it's just a fact of life.
And, of course, the technology age has revolutionized the way we do everything. This same column can be on a computer screen on the other side of the world with a mouse click. Talk about cheaper look at the price, speed and quality in the area of personal computing.
The point is this: Your customers' expectations have changed. People expect more for less. They inhabit a fast world, and they want their products and services fast, too. And if their products and services don't come fast and cheap, they'll look elsewhere to get them.
If you are to succeed, the way your shop does things will have to change, as well.faster
Think about equipment and machinery. The newer table saws not only can cut more accurately, many are much faster, too especially a beam saw. If your shop employs more than, say, seven people, computerized equipment may have a quick payback time. A fast edgebander can help. So can a point-to-point machine.
Computers in the office and in pre-production can cut down time in accounting, job costing and in cut-listing parts. Take a parts-optimizing piece of software, for example. That alone can speed up the way things are done. Yes, there'll be a learning curve, but in the end, the production process may be much faster.
Many shops are very careful in how they lay out their workspace. You can pick up speed from less material handling, and from the efficient placement of equipment and workbenches.
You may simply have to demand higher productivity and accuracy from yourself and your people. Gone are the days where you can afford to have staff not making money for your company. These days, people need to get it right the first time.
We've found at our shop that employees need to be good, skilled
and trained well if we're going to continue to pump the work out
How can you build your work for less money? Well, you can start by keeping a tight lid on expenses, especially your overhead.
You may want to take your last financial report and look hard at these fixed costs. Can you get your landlord to lower your rent? Can you get by with less garbage service? Can you increase the co-payment your employees make for health insurance coverage?
Your variable costs, too, are worth looking at. Take your materials, for example: It's good business practice to always ask your suppliers for the lowest, lowest price. Ask them if they'll inventory your melamine so you can be more efficient in your own shop. Remember that "Just-In-Time" can be a very efficient way of producing work.
Perhaps you can buy out more work. We're all familiar with the companies that manufacture custom cabinet doors, but how about buying your drawers out, also? Maybe you can consider subcontracting out certain parts of your work such as veneering, finishing or installation to firms that specialize in that work.
It's obvious that work that costs you less to produce is more
profitable, so why not set the tone on the shop floor for no
mistakes? People who screw up on a regular basis simply cost your
shop money. Let them leave and go make mistakes for a competitor.
Your crew needs to be a tightly knit group of motivated people,
optimizing what gets done and how.
So, exactly what is "better"? Sure, "better" is a beautifully matched grain sycamore veneer kitchen with perfect 1/8" reveals everywhere. Remember, though, that you can achieve "better" with good people who are skilled at what they do. Experience goes a long way here.
Good tools, machinery and equipment will all contribute to "better" on the shop floor. It's hard to beat a point-to-point machine, for example, when it comes to accuracy and crispness in drilling, or an overhead router if you're trying to cut out repeated shapes.
But there's a big argument for "better" to your customer in the form of excellent service. Being on time with your promised delivery, for example, is "better." Being courteous and polite is "better." Even down to the little things tee-shirts for your employees, clean delivery trucks it will all contribute to your shop being "better" in your customer's eyes.
The next few years are going to see even more pressure on you to
produce faster, cheaper, better so get ready to do all three!
Next Column: Benefit Packages for Shop Employees.