Manufacturing is something that trips up a lot of smaller and medium sized businesses. Many feel that they’d prefer to keep their production in house rather than outsource to another company due to costs and control issues- but are put off due to it being such a mammoth task. What exactly do you need to know when it comes to manufacturing, and is it really out of reach for smaller and medium sized companies?
Getting set up
Whether manufacturing your own products will be a possibility will mainly depend on what you want to make and what your budget is. If your business makes complex items such as electronics which require a lot of technology and specialist manpower then you might struggle. For other companies, it might not be too difficult to source and run the machines you need, even if you have to buy second hand. Some of the practicalities you will need to consider is where your plant will be based, and whether you can source skilled workers to run things. If you’re able to do this, then manufacturing might well be in reach for you.
One of the major roadblocks for SMBs looking to manufacture their own products is the costs of getting set up can be incredibly high. You’ll need factory and warehousing space, equipment, materials and staff. However, if you’re able to make this work, once you’re up and running it’s worth knowing that you will save more in the long run compared with outsourcing. So if you’re in it for the long haul when it comes to your business, and you have a product which is selling well, taking out loans to cover the startup costs could well be worth doing as it will pay off for you long term. Just be sure to get your finances right, you need to ensure you’re able to cover the costs of borrowing money as if things spiral out of control it could easily lead to bankruptcy. Spend some time sitting down and crunching the numbers, find out if it’s worth it for you.
Health and safety
Any workplace comes with risks, even in a shop or office employees can suffer slips and trips which can be disastrous if it was a result of your neglect. However, when you’re running a manufacturing plant, there are many more risks of accidents and injuries due to the nature of the workplace- from heavy machinery being in operation, vehicles like forklifts going back and forth and powerful equipment such as drills and saws being used, it makes things much more risky. For this reason, you need to take health and safety incredibly seriously and make sure that you’re insured correctly. Everyone should be properly trained and qualified and wearing the right equipment. If not and someone is hurt, you’ll end up with a personal injury law firm on your case, seeking the compensation your employee will be entitled to.
Have you ever considered manufacturing in your SMB?
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