(Courtesy of Guest Blogger Liz Fox, senior marketing associate, MAGNET: The Manufacturing Growth Advocacy Network)

As manufacturing shifts and grows through technological innovation and higher demand, shops are continually becoming more flexible and embracing the idea of slimming down. As a result, manufacturers are looking for ways to save money without sacrificing valuable manpower, processes, or components. If your efforts aren’t producing ideal profit margins, the following are some valuable cost-reduction ideas that should be considered in your long-term plans.

Assess and enhance your processes.

Before taking the next step toward cutting costs, you need to assess your manufacturing processes by looking at them from every angle. What details do you notice? Are there unnecessary steps or equipment? When you look at the big picture, it not only tells you where things can be improved, but gives you guidance on how to innovative so that materials aren’t wasted, labor isn’t costly, and scrap is minimal.

This can involve the following:

• Implement additive techniques to reduce development time and use less expensive materials
• Make better use of suppliers by evaluating and prioritizing your current needs
• Modify designs to make them more cost-effective
• Adopt Lean manufacturing and create a culture of continuous improvement

Go green.

Companies now are more receptive to sustainability as a key pillar of their day-to-day operations, and this means cutting back on energy consumption. With the right blend of technology, real-time data, and other resources, companies can run slower without disposing of good customer service or creating longer lead times. Take initiative by installing energy-efficient lighting fixtures, rescheduling the use of high-powered equipment, and putting together a special team to ensure all energy-oriented manufacturing costs are being managed appropriately.

Consider the cost of inventory.

Inventory space utilized for a long period of time can lead to high costs for storage, maintenance, and insurance. Take measures to make your operations more fluid, responsive, and oriented toward noted actual demand, which can help you avoid overproduction, cut the amount of waste, and substantially reduce cash spent on space for additional product inventory.

For more information, contact MAGNET at 216.391.7002 or visit manufacturingsuccess.org.