As a manufacturer, it's an ongoing challenge to improve your bottom line. Inefficient processes, unproductive employees, and increasing supplier prices can cost you big time.
Here are some unexpected ways to impact bottom line growth. The effort can yield great rewards!
Improve Your Processes
When was the last time you reviewed every department’s goals and related processes to ensure everything is current and geared to achieve the organization’s strategic goals? Well-defined goals, processes and procedures not only clarify what is expected of all employees but also helps reduce errors and save money.
Learn how improving your processes can earn you tax savings with the R&D Tax Credit.
Administrative processes can take a big bite out of the operating budget. Review your current processes to identify activities that can be done more cost-effectively.
Next, focus on the new employee hiring process. Human resources is among your most important assets, but if the hiring process is leaving you with unproductive employees, it will cost you. Here are a few tips to improve your HR processes:
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Hold your hiring process accountable – Accountability starts with defining clear and measurable performance for each employee, from the initial job description to the performance criteria established so that both the employee and supervisor understand and agree upon measurable objectives. When you hire the best-qualified candidates the first time around, your benefits will include faster competency and productivity, savings in time and money, and lower turnover rates.
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Improve your hiring process – With new hires, ask for confidential feedback after 30 days on the job, and conduct exit interviews when employees leave the company.
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Revamp your development processes – Offer seminars and training to build interpersonal communication and problem-solving skills along with technical training.
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Train salespeople to uncover customers’ pain points - Training your sales team to follow a consistent sales process and be problem solvers bonds the salesperson with the customer.
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Be generous – You will see long-term dividends when you provide the funding needed to develop and practice new skills and establish a mentoring network.
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Lead by example - When you invest in a mentoring program and encourage the sharing of tribal knowledge with new hires, you’ll foster a learning environment.
Create a Positive Work Environment
Create a company culture where all ideas related to improving productivity and saving money are valued. Ask employees for feedback about what is working and what is not when it comes to their job. When your employees feel heard, they'll feel valued and and be more satisfied with their job. And satisfied employees are more productive!
You can even develop an ongoing, company-wide contest that awards a cash prize to the employees who identify ways to streamline production, solve a problem, or simplify administrative tasks that improve bottom line growth.
Review Vendors and Suppliers
When was the last time you asked your supplier how you could be a better customer? The special requirements added to your purchase order may be costing you additional hidden fees. This open and honest conversation with your vendor may lead you to negotiating for a better price or terms with your vendors and suppliers.
Can you improve your purchasing costs if you aggregate your purchases with a different supplier?
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Have vendors compete for your business on a regular basis and offer price breaks to keep your business. If you regularly pay your bills early, negotiate a discount for prompt payment.
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One approach to preventing price increases is to notify your vendors and suppliers that any price increases will prompt you to seek competitive bidding.
At the end of the day, whether you're improving HR processes, creating a better environment to work in, or renegotiating your supply costs, you're bound to see a change to your bottom line. Now, it's just a matter of taking the time to do it.
