There aren’t many industries that haven’t faced unprecedented challenges in the last six months. For some it has meant the need to either diversify or scale back production and for others, particularly in the metalwork manufacturing industry it has brought the need to do much more in-house than before.
Outsourcing, although potentially expensive, has long been a part of our industry. Yet the more we reconnect with our industry colleagues and customers, the more we discover they are starting to explore the possibility of looking to bring all of their metalwork manufacturing in-house and are looking at buying the metalwork machinery to do themselves what they relied on others to do previously.
This is due to a variety of reasons.
Taking back control
Even the most efficient, well run business is at the mercy of factors it simply can’t control when using metalwork subcontractors. If those subcontractors are facing delays or have other priority work it will invariably then lead to delays for a business. The knock-on effects from this can often be a backlog of work building up, overstocked warehouses and essentially, loss of business if the end product doesn’t reach the client in good time.
At a time when meeting expectations is vital, having the in-house metalwork machinery to complete the job from start to finish can help to exceed them and help your business stand out from the crowd.
A leaner, more organised approach
Processing and organising shipments from a metalwork subcontractor takes resources. At a time when shipments might be more varied and less frequent or reliable, this may mean valuable time and manpower has to be spent locating parts, arranging jobs and the inevitable disruption to workflow and lead times.
Bringing the metalwork manufacturing process in-house does away with these problems in one fell swoop, leaving a smooth and efficient workflow to be undertaken by your direct employees.
Saving time with flexibility
However hard we try and however closely we manage the details, sooner or later the inevitable happens and a job goes wrong. Your assembly crew turns up to site and the part doesn’t fit, the holes don’t line up or the specification has changed without the drawings being updated to suit. This means delays, sometimes even penalties…
If parts need to be returned the impact can be costly, yet if the work is done in-house those delays might only be hours appose to weeks that you might have to endure with outsourced manufacturing that may be based at the other end of the country.
Regulating your costs
Metalwork machinery is a significant investment, the key word there being investment. The right machinery empowers your business to streamline the cost of production, automate it and do much more in a lot less time.
Sometimes the actual cost of outsourcing is low but the cost of transport can be high. This is often the case if your business is in a remote part of the UK or Europe. By bringing production in house this will also inevitably lower your carriage costs.
The cost of materials such as sheets and plates will still fluctuate but streamlining and setting the costs of production in-house is another key reason why many metalwork manufacturers are moving towards doing much more themselves than they ever did before.
Diversification and prototyping
Exploring new avenues of business and having that ability to produce a wider range of products with more adaptable, efficient, and versatile in-house metalwork machinery is an obvious benefit.
The ability to open your own business to outsourcing and undertaking work for others by becoming a subcontractor yourself. If you feel your current capacity does not justify bringing production in-house, there is always the option to offer your capabilities to your local area during quieter periods.
The question of finance
The COVID-19 pandemic has made cash flow a vital factor in every organisation’s plans for their short-term futures. This means there has never been a more important time to finance business purchases.
The positive news is that finance can be obtained for any business regardless of age, size and credit rating with decisions often made on a quick turnaround.
If you are looking to invest in metalwork machinery, there are a number of finance options available, each with slightly different characteristics.
An agreed fixed or minimum term of rental period for an asset with regular payments for the duration of the Lease contract. At the end of the contract there is the option to purchase the machine.
Hire Purchase (HP)
An agreement to purchase the machine over a specified period. There is a small payment at the end of the agreement for ownership of the machine.
Coronavirus Business Interruption Loan Scheme (CBILS)
The British Business Bank operates CBILS via its accredited lenders. There are over 90 of these lenders currently working to provide financial support to smaller businesses affected by Covid-19. Each lender can provide up to £5 million in the form of loans, overdrafts, invoice finance or asset finance and are given a government-backed guarantee for the loan repayments to encourage more lending. The borrower remains fully liable for the debt.
For help and advice on our extensive range of metalworking machinery that will enable you to bring all your metalwork manufacturing in-house, get in touch today.
Published 29th September 2020