CNC Machine Shop Expansion
CNC Machine Shop Expansion has only moved into numerical control in the last three or four decades. There has been so much new development with multi-axis machines, Industry 4.0, and growing demand for precision parts it is almost impossible to keep up. When you are thinking it may be time for your CNC machine shop expansion there are several factors you should consider to make the jump at the right time. There are different views towards expansion and growth and your business may not follow the same path as another.
Scalable Growth
There is great value to working in a niche market so you aren’t competing only on a price or re-organizing for each new project that comes in. This is a solid place to start. One approach to growth is to take a small step out of your niche with something that closely aligns to test the waters. While it may be considered risky to work outside your area of expertise, new projects may be just the thing to scale your business. Be sure you assess and review them for a cost-efficient approach that adds diversity. Not only can this approach grow your business, but could also provide a haven in a market downturn.
Business growth may also present itself with value-added services. Evaluate the parts you provide and see if you can add value with a processing component, packaging, or a complimentary product that streamlines your client’s business and adds additional volume to your facility. Satisfied customers are a great place to look for areas of growth since they already trust your quality and service.
Knowing is Growing
A key element in finding areas of growth is staying connected to the industry. One of the easiest ways to accomplish this is to attend events. While this has been a challenge over the past 18 months, look for events that are starting to open up again. Connect through online forums and industry publications. Not only does this keep you apprised of industry news, but can align you with potential partners and keep a close eye on your competition.
Industry connections allow you to witness successes and find opportunities. Making good parts is only a piece of the puzzle. Relationships are often what fuel the ember of an idea to flame or produce the initial spark that you then develop.
Partners
At Rapid Enterprises we are big believers in over-delivering in service and quality. We succeed because of key partnerships with brands like DMG Mori and Mastercam who allow us to use the tools and technology we need to provide consistent products on time every time. Our expertise grows through their expertise.
Partnerships might also look like referrals from related businesses. If you haven’t made that transition to complementary products or services you can provide, those could be referral partners for you. Keep communication channels open to discover what their clients need and how you can help. Partnerships like this are easily established by growing your network at trade shows and other industry events.
Finance
We dug deep into finance in a previous article, but it is worth mentioning again in terms of expansion. A common mistake with many businesses is not creating a business plan. This should be the first step before you even start a business, let alone, try to expand. Business plans provide you a target, allow for measurement and assessment, and lead to revisions as needed. They are also necessary when you apply for loans, grants, or joint-venture partnerships.
Smart financing includes a realistic review of necessary and unwise spending. New machines, new technology, or physical shop floor growth must consider cash flow, booked business, new markets, downturns, and cash versus loan payments. New technology is enticing, but a practical risk versus reward analysis is needed.
