Manufacturing Day: Open Doors, Open Minds

by Chris Ilcin, Account Superintendent

Inspiring the next generation of manufacturers.

We were going to do a big wrap-up of all the Manufacturing Day 2018 events our clients, partners and friends hosted, but this video from the National Association of Manufacturers does a better job than we could.

 

 

Please make sure you share. And start prepping now for Manufacturing Day 2019!

 

Share this:

What’s Holding US Manufacturing Back?

Today we have a post from Andrea Olsen. Andrea started her career in the tech start-up world, and has brought much of that innovative thinking to her work as the CEO of Prag’madik, an operational strategy consultancy, specializing in the industrial and manufacturing markets.

What’s Holding US Manufacturing Back?

There has been an ongoing national conversation about bringing manufacturing back to the United States. The government, states, educators, and organizations have been pushing a resurgence through, addressing many of the roadblocks facing these organizations, including: lack of skilled labor, decreased sales, advancing lean manufacturing, integrating additive manufacturing, robotics, IoT and Big Data.

The middle-market manufacturers – primarily in the Midwest, in the range of $50-$500m in revenues, employing 10-800 people – face a unique set of challenges. While the advancement of things like 3D printing and robotics will undoubtedly change the manufacturing landscape, these manufacturers face much more basic challenges to compete – and more accurately – survive the next 3-5 years.

This isn’t about the “skills gap,” or “robots taking jobs,” or “offshoring” or even “regulation burdens.” Those challenges are further downstream for these manufacturers. Today’s issues are much more fundamental. The advancements in digital technologies, communications platforms, and simply the Internet, have dramatically impacted business operations and overall competitiveness. The “blocking-and-tackling” of things like: embracing change, utilizing technology platforms, digitizing information and fostering an innovative culture, are the true essentials for US middle-manufacturing growth. Here’s a short list of those essentials: (more…)

Share this:

Change Your Definition, Change Your Business. Learn From Other Industries How to Manage Change

By Chris Ilcin, Account Superintendent, Sonnhalter

A recent Industry Week article by Becky Morgan showcases how a changing industry can adapt and thrive or fixate and die, and has some great advice for being on the right side of that divide.

Her first point is to draw parallels between the state of manufacturing today and that of agriculture at the turn of the last century. Rocked by disruptive innovations, a changing marketplace and demographic shifts. And yet agriculture is still around. It’s fundamentally changed, but in a way that’s of benefit to consumers: more productive, larger scale, but with a core of, to use an overused term, “artisanal” craftspeople ready to cater to niche markets.

She sees manufacturing developing in much the same way. (more…)

Share this:

3 Pricing Adjustments Manufacturers & Distributors Should Make Now

This post originally appeared on INSIGHT2PROFIT.com

Years ago, an Ohio-based specialty metal business made the decision not to charge for freight costs, even though their products were extremely heavy. The rationale? None of their competitors were charging, so they couldn’t either.

In reality, this company was  No. 1 in the industry, so all those competitors were actually just following their lead. When the company realized what was going on, it had the opportunity to change the policy for its entire industry.

And so it did—collecting more than $1 million in additional revenues.

Smart companies know pricing strategy isn’t just about the price on the invoice. To have an immediate impact on your bottom line without formally raising prices, here are three areas to tackle first.

1. Freight Costs

If you’ve been operating for decades, your freight policies have probably been in place just as long. Maybe you don’t charge for freight at all, or fees are the same across all territories—or you charge the same as you did 50 years ago even though shipping rates have risen dramatically.

To start, ask yourself:

  • When was the last time our freight terms were updated?
  • What is our justification for our freight policy?
  • What are our competitors doing in this space?

This line of questioning can help internal stakeholders determine if there’s opportunity for improvement without much effort, as the aforementioned specialty metal business discovered.

2. Rush Orders

When you place an order on Amazon.com and you want 2-day shipping, you understand you’ll have to pay premium pricing—in this case, $99 for a year of Amazon Prime.

Your customers realize this, too. Yet many manufacturers and distributors don’t charge extra for rush orders.

If your lead time is two weeks, but your buyer needs his order in three days, are you charging extra? In order to get that order to the buyer within his limited time constraint, you’ll have to disrupt your operation, move around other orders and pay higher shipping costs. You might even put other orders at risk. You should be paid for those efforts, but many manufacturers don’t actively seek compensation.

Remember, if a buyer needs an order faster than usual, they’ll gladly pay to get it sooner.

3. Volume Discounts

It’s natural to want to offer discounts to your biggest customers, but if you don’t have a discounting strategy in place, the practice can steadily erode your bottom line.

Discounts shape your customers’ perception of your pricing: With every discount your give, the lowered price becomes the new standard. The next time that customer calls with an order, she will expect that same price, even if the order is only half the size.

The key here is to communicate early and often regarding volume discounts. When buyers understand why they are receiving discounts for a specific order, they will begin to understand the rationale behind your invoicing and, therefore, not expect discounts with every order.

Additionally, the threat over-discounting poses on profit often goes undetected since most companies don’t truly know how much profit is lost when sales reps offer discounts. Your company does not need to ban discounts all together, but a discount ceiling should be put in place to keep your profits from decreasing too drastically.

Start Small (and Risk-Free) with Freight, Expedites and Discounts

Raising prices throughout each of your product lines can be a highly complex process that demands a lot of analysis. Freight, expedites and discounts are areas you can impact quickly without upsetting current customers.

Start by identifying improvements that can deliver the most profit with the least amount of risk and effort. The extra revenue you uncover can be used to support larger-scale strategic pricing efforts in the future, such as increasing product prices, which will require more time, effort and commitment.

Bad pricing practices are more common than you’d think. Find out why bad pricing happens to good companies in our free guide.

Share this:

Marketing 101 for Manufacturers

Today, Matt Sonnhalter is sharing about a recent seminar he co-presented.

I recently had the privilege of co-presenting a “Marketing 101 for Manufacturers” seminar for MAGNET (Manufacturing Advocacy & Growth Network) with a colleague of mine, Sage Lewis, president of SageRock. You can see the full presentation here, but I want to focus on one of the closing slides of this presentation, “10 Key Factors for Successful Marketing Programs.”

  1. Upfront Planning – it’s not ready, fire, aim! Make sure you have clearly defined your objectives, target, budget and message. Also make sure you set priorities, it is better to do one thing well than multiple items poorly.
  2. Marketing Champion – often times marketing is one of the most overlooked functions within an organization. It is important to make sure someone internally is dedicated to leading your marketing efforts and ensuring their success.
  3. Lead Process – I can’t tell you the stories I’ve heard from manufacturers who spend tens of thousands of dollars at a trade show to generate leads, only to find out the leads are never followed-up on. You have to have a clear plan in place to handle the leads generated by your marcom efforts, from where the leads are going to be stored, and how these leads are being qualified, to who’s following up on the leads and in what time frame.
  4. Patience – in this technologically driven world where we have access to everything 24/7, we seem to always expect results instantly. Sometimes marketing programs take time to run and reach their full potential, so you must be willing to make a commitment and have faith in your marketing programs. If you’ve done your initial upfront planning, you have nothing to worry about.
  5. Resources (internal/external) – none of us have all the resources or time to do everything we would like…not even mega-brands like Nike and Coca-Cola! It’s important to be realistic about what resources you have internally at your company, and if you do not have the bandwidth to successfully implement all of your marketing programs, then you need to prioritize the list and focus on the ones you can handle and/or leverage outside firms to help augment the workload.
  6. Strong Call-to-Action – all of the elements in your marketing program need to have some sort of call-to-action. It can be as simple as going to your website, but you should always give your customers a “next step” with your marketing efforts.
  7. Marketing & Sales on the “Same Page” – if there are ever two departments within an organization that need to work closely together, it’s Marketing and Sales. While they are two very distinct disciplines within a company, marketing is there to support sales and it is critical that both of these departments are working towards the same goal.
  8. Integrated Program – there is no single one marketing tactic that works all the time, so it is important when building your marketing program to have a mix of marcom tactics.
  9. Measure – in order to grow and optimize your marketing plan, you need to try and measure results wherever possible. Otherwise, how do you know if something is working?
  10. Experiment – you can’t be afraid to experiment. There is no “magic formula” or “silver bullet” in marketing; what works for one manufacturer is not going to work for the next.

These are some of the top factors for helping ensure a successful marketing program, but it is by no means an exhaustive list. What are some of the key factors for your successful marketing programs?

Share this: