The early days of a startup were mostly spent doing market research, assessing the competition, and seeking funding from friends and family. When you start researching and talking to the manufacturers, it all starts to feel like the real thing. But finding the right manufacturer is not at all an easy task. Manufacturing is especially complex now with disrupted supply chains, material shortages, reduced workers, and price inflation.
We have gathered some tips that you should keep in mind before diving in to the manufacturing industry:
Look For Mutually Beneficial Partnerships
As a startup, you may not take it seriously enough from a large manufacturing company. And the amount of business you provide them is not significant as well so, it is imperative that you should create incentives to work with your manufacturing partners.
George Burciaga, CEO of elevate DIGITAL, has wrestled with this exact situation by launching a business to build interactive touchscreen-based digital displays. His assembler was quite a large company, but he never created a product in this particular category
Burciaga confidently persuaded them that the partnership will be mutually beneficial as the assembler expands into new categories. This is a must-have strategy at all growth levels.
Taking Gradual Small Steps
Setting up your own production unit will surely take a lot of time as well as money. You can not afford to make any careless mistakes.
Cricket Allen, the perfect Snaque founder, a nutritious snack company, said that the entrepreneurs must avoid risks in the initial stages by renting or leasing equipment rather than fully buying them.
Depend on more manual work and low-investment in the first few months, as your product would go through many changes during this time. You can get yourself quality raw materials at FabAuto Liner.
Adequate Researching
Whether you are looking for a vendor or installing your own manufacturing unit, you should do extensive research before making any decision. Industry magazines or trade fairs are a great way to research and connect with manufacturers.
"Find someone you want to do business with and don't settle for the first person you find. Make sure you have a choice," says LawsonNickol, co-founder of AllAmericanClothing. Also, get yourself updated with the latest manufacturing news to become an industry expert.
A Proper Business Plan
For example, when manufacturing baby spoons, find a manufacturer with a lot of experience in the baby and consumer market sector.
Having a manufacturing partner who is familiar with the industry in which you are expanding means that you can be up-to-date with best practices , safety standards and get various useful insights. Here are a few things you should consider:
Sorting Out Your Legal Details
It is advised to the business owners to visit the local government websites and speak to anyone who knows about the types of licenses and certifications required to set up a store. Once this is done, you can buy the equipment and confidently hire your business employees
Picking The Right Location
Position plays an important role in the manufacturing industry and towards the success of the business , as remote work is not a wise option. Transport links in your location need to be evaluated properly.
There are also other basic factors which include, proximity of raw material suppliers , other neighbouring businesses, etc. Also, make sure to analyze the practicality of the position.
Seek References
Kevin Lavelle, co-founder and CEO of the innovative men's lifestyle brand Mizzen Main, said finding the right manufacturer was difficult. Unlike programmers, only few manufacturers exist digitally.
So, checking the references is of utmost importance. When you are starting new, caution should be taken in each and every small step.
It's Crucial To Have Multiple Open Partnerships
Rather than focusing on just one good vendor, offer yourself with several reliable options.
MaryApple, the creator of PrettyPushers, which produces special labor gowns for women, works with a list of excellent vendors for risk dispersal and competitive pricing, and advises them to use them alternately.
Your previously grateful vendor could ignore you when they have secured a larger customer, or your partner could close the door for a few months due to an unfortunate factory fire . These types of scenarios are endless, so it is key to have a few good suppliers that you can choose from.
Adequate Unit Scalability
Not all vendors can scale to fit your business. As the startup grows, so does the number of units needed. First manufacturing partners are sometimes good with prototypes and small batches, but in many cases problems can arise.
Minimize production delays by meeting with other potential manufacturing partners who can adequately respond to high volume demands. You don't have to stick with just one vendor. If your business is in a dire need of quality cylinder linders, check out FabAuto Liners.
Having a Good Amount of Info About the People You Work With
Keep in mind that your manufacturer is an important part of your business. It is important to familiarize yourself with them before handling them. This applies regardless of whether the manufacturer is located nearby or in another country.
NickParadise, CEO of ThreadBuds, encourages us to use email, phone, translator and personally visit to reveal more details in your first venture.
When you visit the facility, you can meet factory workers and see the facility for yourself. You want to feel the comfort that your product is in the right hands, then a site visit is the perfect way to ensure this.
Don't forget to check the references. Get your doubts cleared by the people who have experiences with these potential manufacturers .
Proper Management Of Your Expenses
For online businesses, even if you have only one customer with little or no initial investment, you will be profitable as soon as you start.
However, manufacturers may not be able to enjoy these luxuries because machines and tools require a significant initial investment in the form of raw materials, buildings and expertise to start producing output.
Therefore, there is a minimum conversion required to reach the break-even point. It is especially important to control costs in the early stages of achieving the critical mass. Procure consumables at the best possible prices and keep your raw material inventories tight.
Make a good business plan with the digital tools you need before you start. The right start can actually make all the differences and guide the business in the right direction.
Manufacturing Management Conclusion
If you feel confident considering the above factors, then you are in a pretty good place to start a manufacturing business. Make sure you evaluate everything carefully at least once during your manufacturing process. Then, with the necessary investments, you can be sure that your business starts and grows on the right foothold during a difficult economy.
