Is it time to offer new products and services to your customers? Successful business growth only comes with change. In the steel and metals industry, fabricators are seeking new ways to boost productivity and profitability, and there are several ways you can do this.
Innovate to Drive Growth
The steel and metals industry is in a constant state of change—from supplies and operations to customer demands—and this requires a continuous review of operational and financial data. Owners and leaders of fabrication businesses must keep a close eye on profit margins as labor and costs fluctuate. This is no small task and keeping a pulse on the fiscal health of your business becomes even more important as you plan for growth.
Here are 3 tips for expanding a fabrication business:
- Improve labor productivity: You’ve hired a skilled workforce, which is important. Equally important is putting them to work on the right tasks. You may have a mix of experienced and entry-level workers. In order to optimize both productivity and profitability, employees should be assigned tasks based on their experience and skillsets. It’s also important to take a look at workflows and efficiencies. Rearranging stock items in storage and on the floor could be a boost to productivity, for example, by reducing the time needed to move raw materials or finished products around the facility.
- Optimize equipment and software: Updating tools and equipment could pay off in the long run. If you have outdated machinery that requires constant maintenance, it may be time to replace it. Instead of using a machine, like a sheet metal bender that requires two or more operators, it could be more affordable to upgrade it with machinery that requires fewer operators. Replacing manual processes with modern equipment and business management solutions will improve productivity across your enterprise. Using time-saving automations during production or when managing business data also reduces the risk for human errors. Retooling products or recalculating financial data takes even more time and money, which can be an even bigger burden on your bottom line.
- Monitor profit margins: One of the most important tips for expanding a fabrication business is to keep an eye on your finances. You need to be able to monitor expenses, revenues and financial transactions in real time. Profit margins are tight in every business sector and the steel and metals industry is no different. Making accurate quotes based on materials and labor, scheduling procurement and managing inventory, as well as planning customer deliveries, can either make or break profits. An integrated business management system that monitors key business processes from the front office to the back warehouse is essential to a healthy bottom line.
Change is a constant in the steel and metals industry and fabrication businesses need to be able to keep up or risk becoming obsolete. With a little planning and innovation, you can drive growth and expand fabrication operations. Contact The Wolcott Group for more information and tips for expanding a fabrication business in this modern, digital era.