Cut waste, not prices
In an open letter, First Degree Systems’ Sales Manager Greg Beachim asks if there are more efficient ways of maintaining profit than simply competing on price.
Don’t get caught up in the race to the bottom.
I’ve been in this industry for around 30 years, and that warning has been repeated constantly during all that time. Do people take notice? I’ll let you answer that one.
It’s very easy to say that you are not going to compete on price when the market is booming and everything is going well, but when things change – the number of leads starts to ease, your customers look to reduce their input costs, and your overheads increase – the temptation is to take a different view.
So starts a race to the bottom, and is not surprising when companies struggle to balance the books and have to call in the administrators. The fenestration hall of fame is littered by once dominant names who didn’t adapt in time, and tried to cut prices to win customers.
Regardless of where we are in the economic cycle, keeping overheads down while producing a quality, well-priced product is essential for any fabricator. Take away any one of those three things and you risk undermining your offering: a race to the bottom on price does not work; swapping out quality components for cheaper alternatives doesn’t work (buy cheap buy twice?); and not controlling your overheads will leave you with a beast that is too expensive to feed, while not offering your customers quality service.
As someone who works with many window fabricators, I can confidently say that companies with good reputation and a loyal customer base should be able leave their products untouched, and prices unchanged.
Where manufacturing operations have a blind spot is the processes that keep them moving – and not updating them as required. So, as orders, customers and product ranges grow, then new machines, more people and more stock are added.
Meanwhile, the brain that keeps control of the whole operation may not have evolved beyond a series of spread sheets and a basic software package that sends the designs to the shop floor.
If you were to subscribe to a Window Designer package, it will pay for itself almost immediately. Talk to one of our technical team, and they’ll give your business a health check, but ultimately, Window Designer – along with various add-on modules – will be able to improve your product quality, greatly reduce errors, reduce stock holding, and give your customer relations a boost. All while boosting your bottom line.
The Cloud Retailer module, for example, allows fabricators to offer Window Designer to their retail customers, which allows them to submit window designs straight into the manufacturing process. This also allows retailers to produce quotes on demand 24/7.
This means the orders only need reviewing before being added to the system – you don’t need someone re-processing them, so you are not risking processing errors and delays. And your customer will appreciate having that element of control!
If you think the only way to keep the bottom line healthy is by cutting prices to sell more product, then think again. Finding efficiencies within your operation may be a far better win.
