Planning on starting your own manufacturing company? Entrepreneurs often target manufacturing as this is an industry that is always in demand, it can be rewarding work, and there is the potential for high levels of success. There are many reasons to start a manufacturing company, but it does have its own challenges, and it can be hard to find success when you are competing against much larger, more established businesses. With this in mind, read on to discover a few key pieces of advice for starting a manufacturing business that will hopefully help you to find success and hit the ground running.
#1. Choose a Profitable Niche
First, you will want to choose a profitable niche. You need to consider the kind of products that will help you to find success, so you need to be aware of what the current and future trending areas are and not just products that you have an interest in. A few of the main areas of manufacturing include:
- Clothing and textiles
- Petroleum, plastics, and chemicals
- Food production
- Wood, leather, and paper
#2. Carry Out Competitor Research
Once you have decided on a niche, you can then start your market research. One of the key areas of this will be competitors analysis, which will involve identifying and researching the competition. This should include competitors in your region as well as industry leaders. This will help you to identify strengths and weaknesses and give you an idea of how you can build a brand that will stand out from the crowd and appeal to your target market.
#3. Determine Your Target Market
Following on from this, another key area of market research is identifying your target market. You need to know exactly who is buying the products that you are making and how you can appeal to this group. Creating customer personas can be helpful as you can identify a number of different types of individuals that purchase your products and then find ways to target this group. Once you know who your target market is, you can then create a brand and products that will appeal to this group.
#4. Establish USP
In a competitive industry like manufacturing, it is important that you establish what your USPs are. It is hard to win over customers and lure them away from the competition if you are not offering something unique and bringing something new to the table. Hopefully, your market research will help you to determine what USPs will get your brand noticed and make you appealing to your target market. You then need to make sure that these USPs are clearly established so that people are aware of what separates your business from the competition and why they should choose you over the more established brands.
#5. Create a Business Plan
Once you have all of the above, you can then get to work crafting your business plan. This will be the document that guides you during the early stages of the business and can also be used to secure funding. A good business plan is key to success, so this should not be an area that you rush. The key parts of a business plan include:
- Executive summary
- Company description
- Market analysis
- Competitive analysis
- Description of management and organization
- Breakdown of products and services
- Marketing plan
- Sales strategy
- Request for funding
- Financial projections
#6. Secure Enough Funding
One of the key stages of starting a manufacturing company is securing enough funding. This is because there are many costs that need to be covered when starting this type of business, so you need to make sure that you raise enough so that the business can find success from the very start. Costs might include commercial space, staff, equipment, materials and supplies, transport, and marketing, just as a few examples. You can use the business plan to help secure funding, and there are a number of different options to consider, including:
- Loans from loved ones
- Bank loans
- Angel investors
- Venture capitalists
#7. Choose a Commercial Space Carefully
Another important step is choosing the space for your manufacturing company. Obviously, this will need to be somewhere that is large enough to comfortably and safely house your operation. In addition to this, it is somewhere that needs to have good transport links and parking. Ideally, it will be somewhere with a decent talent pool nearby so that it should not be too hard to recruit. It can be hard to find somewhere that ticks all of the boxes and is affordable, so you should start your search early on to try and find somewhere that is suitable for your business.
#8. Recruit Hardworking Staff
When it comes to recruitment, you should focus on hiring those that have a good work ethic. It can be hard to recruit people with a lot of experience and talent to a startup, so instead, you should prioritize people that will work hard and have a positive attitude. You can then use training to improve their abilities and bring them up to speed. In addition to this, you need to provide a healthy work-life balance for your staff, know how to keep them motivated, and offer plenty of perks along with competitive pay.
#9. Invest in High-Quality Equipment
In manufacturing, one of the major expenses will be the equipment and machinery that you use. This will have a direct impact on the efficiency of the operation along with the quality of the products that you manufacture, so it is not an area where you should be looking to make large savings. It can be expensive to invest in this equipment, though, which is why it is worth looking into lease deals that could work out cheaper or perhaps second-hand equipment (just be sure to maintain this equipment carefully).
#10. Embrace New Tech
Following on from this, you should also embrace as much new technology as you can. Manufacturing is constantly being improved and changed due to new technological developments, so you will want to start out with modern tech so that you can compete at a high level. A few of the key types of technology that you should be using include:
- 3D printing
- Augmented and virtual reality
- Internet of things
- Big data
#11. Automate as Much as You Can
Leading on from this, you should automate as much of the daily operation as you can with software and equipment. This is ideal for startups because you can reduce the number of staff that you need, which will help you to reduce costs without worrying about making staff redundant. You should automate as much as you can and then hire staff to fill in any gaps and areas of the business that need a human touch.
#12. Get a Masters in Lean Manufacturing
Lean manufacturing is a model that every manufacturing company can benefit from using where productivity is maximized by reducing waste. This is a model of manufacturing that has been used since 1930 with “The Toyota Way” and should be embraced by a startup. The best way to do this is with an online masters degree in lean manufacturing that will teach you all that you need to know to implement this into your operation. The course can be taken entirely online and is worthwhile as it will help to increase productivity and could help you to start competing straight away.
#13. Start Marketing Early
One of the aspects that new manufacturing companies struggle with is getting their brand noticed, especially when competing against much larger, more established companies. This is why it is a good idea to start marketing your manufacturing company as early as possible so that you can raise as much awareness as you can before launching the business. Hopefully, this will help you to attract customers from the start and build a foundation for your business. For the best results, you should use the services of a marketing agency that has experience in helping manufacturing companies.
#14. Use Deals & Promotions
Finally, you can use deals and promotions as a way to attract customers to your manufacturing business. It is not easy to attract customers when you are a new business, but consumers will always be keen to take advantage of deals and promotions, so this can be an effective way to attract customers at the beginning – it is then a case of winning them over with high-quality products and a smooth customer experience.
Hopefully, this post will come in useful for anyone who is planning on starting a manufacturing business. Many entrepreneurs see manufacturing as a good sector for starting a new business, and this is for good reason. There is the chance for high levels of success, and it can be rewarding work, but this is also not the easiest to crack, and many people struggle to find success early on. The advice in this post should come in useful and help you set off on the right foot.