There’s a constant battle for balance when it comes to manufacturing. Trying to keep costs low while producing a quality product is no small concern for manufacturers, and it can have huge impacts on their business operations. The goal is to minimize one while maximizing the other: reduce costs while improving quality.
Because of the nature of this relationship is so inverse, it’s usually easier to do one thing and harder to do the other. As a manufacturer emphasizes the quality of the product, it gets harder to reduce cost, for example.
If you’re currently facing the struggle of balancing this tandem pair of variables, take a look at a few of the biggest drivers of cost and how you might control them without subtracting from quality:
- Materials: Materials have the biggest impact on quality and account for one of the largest expenses of a business. The key to minimizing cost and controlling quality is to broker good deals with a reliable materials supplier, like Quality Metals, Inc. We’ll work with you to negotiate terms, provide inventory at overstock prices, streamline bulk purchasing and more—all of which will cut into the price you’re paying for materials without affecting the quality of the product you’re getting.
- Tooling: Tooling is expensive, but yields the ability to manufacture with more precision and rapidity. Contrary to cost-cutting measures, it’s a smart idea to invest more in high-quality tooling upfront! Your tooling will last longer, produce better results and ultimately save you money by avoiding defects and sub-par products.
- Yield vs. scrap: Take a good, hard look at your manufacturing process and examine yield vs. scrap count throughout the process. You might quickly realize that you’re paying an astounding amount of money for materials that may eventually just end up as scrap! See where you can minimize or even re-use your scrap materials to get the best return on investment for your original materials.
- Quality control: Having a sound quality control process in place is going to decrease costs for your entire business—from ensuring quality products leave the facility, to minimizing customer complaint calls, to maximizing revenue through new sales. For manufacturing costs, quality control specifically lowers defects and can shed light on inefficiencies within the process that may shore up waste.
- Volume: Figuring out non-reoccurring engineering (NRE) costs allows you to better understand where opportunities for purchasing in bulk exist. For example, if you purchase bulk materials to take advantage of better terms and inventory products to offset your NRE costs, you’ll find yourself with lower overall costs on the manufacturing side of the business. Just be sure to keep minimum order quantity (MOQ) costs in mind!
Minimizing manufacturing costs pertaining to your materials should never involve compromising on the quality of the product you’re purchasing. Instead, look for ways to optimize terms around volume and logistics, while conserving and maximizing materials during the actual fabrication process. Cost optimization rather than cost cutting is the key to balancing the scales between material acquisition and quality products.