Keep the long term in perspective
Two years ago, few manufacturers — few companies at all, really — were prepared for the recession. But you can prepare for the ascension, however slow and modest it might be, by being smart during these coming months and years.
You might think about diversifying your product lines into other markets, so you aren’t as dependent on single-source customers, and, more generally, diversifying your portfolio. You might also research how to best tap in to loans, grants or tax credits that are available from various levels and departments of federal, state and local government to help increase business during challenging times. And you will likely want to consider your risks, especially over the long term.
“You can help yourself by really developing a business plan or a manufacturing strategy that embodies the risk associated with the business, with a customer-centric focus and the quality of the products, exploring existing markets or looking at other markets where you can expand,” Fenton says. “Consider your supplies. How do you manage the possibility of wild swings over time in the prices of commodities? How do you plan for significant variations?”
Technology and education, as would be expected, can also play a role in increasing your business. Several experts discussed how the advantage of companies that are owned and operated in the United States is the technology that is developed in the United States. Domestic manufacturers continue to be at the forefront when it comes to utilizing technology in their processes, a trend that will only continue. To ensure that the technology is operated correctly and efficiently, workers should be more educated than they were 40, 20, even 10 years ago, and with so many quality workers still unemployed, there is a deep talent pool from which to hire.
How you handle all of that now might be the difference between a quicker return to profitability and increased production, and the far less appealing option of a long struggle back to respectability and some small sense of comfort in the market.
Most important, though, is to do everything with the long term — and that refers to years and decades, not just months and quarters — in mind.
“There has been some talk about a double-dip recession,” Fenton says. “I don’t know if that will happen or not, but companies are being cautious right now, and rightfully so. Consumer spending is still down, and consumers are retrenching and reducing their personal debt loads. That’s a good thing overall for the economy, though there is a ripple effect on the manufacturing industry. Companies need to continue to be frugal and wise and to look at the horizon.”
