Fulfillment is the name of the game when it comes to manufacturing. You might think your business is far removed from the customer, but the reality is that customers order and expect products to arrive quickly. That turnaround is a key element in staying competitive.
There are many obstacles standing in the way of that fulfillment, the least of which (but no less irksome) being transportation. Experienced manufacturers and product developers will learn to plan around these roadblocks.
There are many obstacles standing in the way of product delivery times. Manufacturers need trucking companies to move a product to a warehouse or retail store. Supply chain is very important. For the same reasons an online seller might find a local ground carrier for home delivery of a product, manufacturers and distributors look for smaller trucking companies to control costs and provide faster service. Payment is made on delivery, but invoice fulfillment can take months for the trucking company.
Fuel, maintenance and personnel costs add up. A trucking outfit might use a freight factoring company for immediate invoice fulfillment, with a small cut to profits, in order to stay agile. Larger trucking companies can afford to wait, but often charge a higher rate for their services. For smaller manufacturers, that higher rate can put a severe dent in revenue and increase costs to the consumer.
There can also be external factors that influence the movement of product, something manufacturers need to be aware of. A strike affecting the Port of Long Beach practically halted imports for a time in 2015, hurting businesses around the world and stifling the flow of goods into the United States.
Then there are road conditions, and routes with heavy traffic. There may also be small problems, like staffing shortages or injuries, that can affect production timing.
The takeaway is that delivery times, for a variety of reasons, may not relate to what’s on the estimate the manufacturer makes in pushing a product to market. Be prepared to deal with several hurdles like these along the way.
Construction companies are familiar with suppliers who cannot fulfill orders, and often face major (and costly) delays as a result. Anytime you are making something you are looking for the lowest possible price to create, and that price changes. If you contract with the wrong supplier, or they do, everyone in the supply chain after that pays the price.
What if you’d secured a deal with a store and you find out your supplier can’t fulfill a key part in your product?
You can order in bulk, but you face the challenge of judging how much you will need to fill future orders without spending needlessly on product you can’t sell. It’s a balancing act you will get better at as time goes on, and as you develop a history with the sales process.
Outside of poor suppliers is the challenge of paying them, especially when you order internationally. Invoicing is a common source of delay, as various companies wait for payment in order to begin work.
One reason why Amazon is dominant in the marketplace is because it is able to fulfill a valuable service to businesses. It can store product, so manufacturers can make something and send it to Amazon for fulfillment. Essentially, Amazon buys that product and sells on its marketplace, even if the manufacturer is directly involved with a storefront.
Product storage is a major concern at all levels. You will constantly encounter this problem no matter how you choose to scale. That’s because of fulfillment. Once you’ve figured out how to store product you have the challenge of moving it quickly to your customers, or to the retail shelf where your customers will eventually buy it.
Promotion and Retail
The final hurdle is just getting the word out. A retail strategy involves talking to a lot of potential partners, hearing some rejection and taking some licks. This can be disheartening after the high of having seen a project through to completion. Don’t give up, when you’re at this stage you’re most of the way there.