ProShop ERP was featured in an article by Production Machining covering “Use Your Machine Shop Management System as a Sales Tool”
The magnitude of the impact to U.S. manufacturing because of COVID-19 is unprecedented. ProShop ERP recently polled our manufacturing customers and found that more than 80% of them have experienced a significant reduction in their inbound sales and opportunities. In addition, 97% of them are looking to add customers. Include the recent explosion of new shops emerging as a result of easy access to low-interest loans for affordable, quality machine tools, and you have a perfect storm of intense competition between machining businesses.
So, the question becomes: How do you market your shop so it stands apart from others in such a competitive environment?
Savvy manufacturing leaders recognize that a beautiful, well-designed website showing off their operations’ newest equipment isn’t enough to spur prospective new customers to knock on their doors. And while a warm blurb about why their team goes above and beyond to exceed their customers’ expectations might tug on their heartstrings, it likely won’t have the same effect on their purse strings.
-How do you market your shop so it stands apart from others?
So, in situations like these, in which there’s more machining capacity supply than demand, shops must be more creative in how they attract and retain customers. Something special and unique is needed to catch the attention of discerning prospects who have myriad potential suppliers for precision machined parts. That something must show prospective customers that the shop has the processes and systems in place to ensure the highest operational performance.
The secret that most shops don’t want to admit is that when you look behind the curtain, many are run like a pirate ship. Team members are running around fighting fires. They’re scrambling to get jobs out the door on time. And they’re presented with weakly defined business processes that don’t support their operations.
It is possible, albeit exhausting, to run a shop like this. But, when a potential customer asks about your processes and metrics, or, heaven forbid, performs an assessment audit, a subpar management system quickly becomes apparent. As a senior supply chain executive for a Tier 1 aerospace company once told me, “I can walk into a shop and smell the disorganization within five minutes. They can’t hide it.”
In order to pass muster with this or any other discerning prospect and compete at the high tiers of the supply chain, you must have modern, robust and interconnected digital systems. Holding a certification for ISO 9001 or AS9100 is important, too, but it’s still possible to pass an ISO audit with mediocre systems.
What customers are really looking for is proof that the combination of your ERP, QMS and MES software, what we like to call a Digital Manufacturing Ecosystem (DME), will provide reliable performance for the orders they place with your company. This starts with multiple areas such as accurate estimates, thorough contract review and risk assessment, detailed planning and robust manufacturing processes with integrated quality monitoring. It then must be topped off with accurate and complete document packages delivered with parts that are appropriately packaged and delivered on time.
East Branch Engineering in New Milford, Connecticut, is an excellent example of this. One of its customers — a large aerospace company — was bought out by an equity firm and the new management team promptly set out to pare down its supply base. East Branch was dual-sourced on a large project with another vendor, and the customer sent an audit team to both to assess their operational systems and performance. During the audit, the team at East Branch demonstrated their entirely paperless shop management system. They took the audit team to watch their parts being made, seeing machinists referencing digital visual work instructions and documenting electronic in-process quality checks. They showed instant and effortless traceability of materials, special processes, first-article reports and how those documents were automatically assembled into complete document packages with a single mouse click. The audit team left with a high degree of confidence that East Branch’s systems would enable them to reliably perform at a high level.
A similar visit to its competitor, which ran a legacy, paper-based ERP system, did not leave the same impression. An audit of past deliveries showed that this vendor was often late and had inconsistent documentation quality. East Branch won sole source on that project, doubling their production volume with that customer. A few months later, volume with that customer doubled again, turning it into one of East Branch’s largest programs.
So, as your shop embarks not only on recovering from this pandemic but also winning and retaining customers, consider going back to basics and working on the underlying systems that run your company. Those systems should not only impress new prospects, but help you deliver consistent, profitable performance for your own existing customers.
Read the article on the Production Machining blog here