As money worries for the average consumer increase, the risk of your products and services moving to the non-essential column may be worrying. To make sure that your offerings stay a necessity on their shopping lists, you’ll need to provide excellent value at the same or lower costs. You may also have to change up your marketing, all while keeping your employees happy.
1. Reduce Overhead Costs
To avoid being eaten up by overhead costs, it’s time to study your expense column. What are you paying for indirect costs? You need support staff for your execs, but could some of those tasks be managed by a contracting freelancer?
The employees who actually put their hands on the products your business produces are a direct cost. Could you make them more efficient by investing in new tools? Could you offer a second or split shift to employees who can now only work part-time? Training just one employee to complete a particular set of tasks is costly. Training 2 part-time employees for the same task doubles the cost.
Reducing overhead costs is important in every aspect of your business. But it’s especially important to reduce your costs in the maintenance and management of your labor force. The key is to invest in your contributing employees and to find ways to save time and money in managing their day-to-day operations.
Many companies are utilizing hybrid models when it comes to managing their labor force. You could have a roster of employees on your permanent payroll while utilizing contractors and staffing agencies to fill supporting rolls for your employee force. Consider the savings alone when it comes to the paperwork of onboarding all of those people. Such tactics allow you to rapidly increase or decrease your overall labor force as quickly as the business needs.
2. Increase Profit Margin
Can you earn more per product you sell? You may be able to increase your profit margin by
- buying larger batches of raw goods in bulk
- finding new suppliers nearby to reduce shipping costs
- increasing your warehouse storage
The “just in time” inventory process may work for very large businesses, but for smaller businesses, having a stock of raw products ready to go on the manufacturing floor is critical to keeping your employees busy.
You may also need to raise your prices. To avoid losing customers, consider offering discounted prices for multiple items when you launch your new single-item price. Putting two in the same box will not take your shipping and receiving folks more time than shipping one, the customer still gets a bargain and you get to keep their business. The next time they only need one item, your customers will likely not balk at the new price.
3. Boost Employee Engagement By Using Their Expertise
If you are a growing company, you are most likely hiring. Having new faces in the workplace is an excellent opportunity to boost productivity through employee engagement. Invite your employees to offer their expertise on ways to improve the efficiency of their workspace and other helpful tips.
You may be using recruiting agencies to help find candidates for your labor force. It’s important that both permanent and temporary employees are synced up and unified in order to ensure the most productive work environment.
Keep in mind that the best agencies are typically nationally recognized ones. You can use job recruiters in Tulsa and other areas nationwide to
- Find temporary labor staff. You can easily adjust how you use this service as the business demands.
- Search for top-level executives and CEOs for your company. With the right sign-on bonus, you could convince a corporate rockstar to relocate for your company.
- Provide instant assistance and relief to your HR department.
- Better manage deadlines and quality of work.
It’s important to ensure seasoned employees are in communication with your new hires and temporary employees. This is a great opportunity to hand out some promotions to some of the hard workers in your labor force. Pick out some strong leaders in your current labor force to act as the go-to person for any task-related guidance.
It’s also important for you as the business owner to communicate efficiently with your labor force. You should be having weekly conversations with your team members to ensure the best possible outcomes for your business.
Have your seasoned employees make a detailed list of what improvements could be made to their space. If all the tools they use are stored behind them on a shelf, could a hanging shelf be added to their work table so the tools are front and center? What would it take to run power or air hoses (as necessary) to that center tool carousel?
These conversations and ideas will take time away from manufacturing. Make sure you keep these conversations light; you want to get together to bounce around ideas, rather than having an official “meeting” about it. Not every idea will work, but all of them are worth listening to. Many may work in the future.
4. Expand Your Marketing Efficiency With Research
Make sure that your marketing team has the resources it needs to gather information from your primary demographic. If your business sells children’s clothing, you need to be able to survey young parents to find out what products work best for them.
Market research can be challenging; because you often have to pay members of focus groups, the data can feel a bit skewed. However, the screening process for many online survey takers is quite good at winnowing down responders to help you get the gold.
5. Make More Room For Stock By Rearranging Your Space
Today’s real estate prices have everyone working to find more room inside their own space. Your business will need to do likewise. Can you rearrange your physical space to allow more room for
- the raw stock?
- finished goods?
- promotional materials?
Carefully review walls with doorways to see if you can build storage shelving around them. If an office, this shelving can be ornate; in your warehouse, you can use sturdier metal shelving for the same purpose. Your inventory process may need to be improved to make this work effectively, but the more you can keep in-house and easy to find, the more control you will have over your profits.
It is still possible to turn a profit in this economy, but you will need to increase the control of your raw goods and finished product. Make sure that your planning includes employees who will be directly impacted by these changes to keep employee engagement high.
