Should You Have A Product Line?
Many job shops, while providing the usual job shop services such as precision machining, also manufacture and sell a product. Often it's a product that the shop invented or developed in-house to solve a problem and now they are selling the device or tool to other shops.
Many job shops, while providing the usual job shop services such as precision machining, also manufacture and sell a product. Often it's a product that the shop invented or developed in-house to solve a problem and now they are selling the device or tool to other shops.
Over the years, quite a few gaps in machine tool technology were filled this way. "Nobody sold the kind of machine we needed, so we built our own," is the story you hear. Even some very important software for job shops came out of job shops who found current market offerings inadequate.
In other cases, shops have taken over a product that one of their customers decided to abandon. Some shops make an improvement to the customer's product or discover a new market for it but the customer chooses not to pursue these opportunities (property rights have to be respected, of course). Other shops simply have inventive and creative types working there who come up with ideas for new products out of the blue.
Having a successful product line has advantages beyond the obvious one of creating additional revenue. The work can keep machines and people occupied and profitably productive if outside jobs slow down. Or the additional work can help justify new equipment or expansions of capacity. Workers can hone or maintain critical skills if the product line calls for them. New techniques or processes can be tried out or perfected on the product line.
Many job shops are offering a wider range of manufacturing capabilities to boost the value-added services their customers are looking for. Complete manufacturing services from design to shipping are what quite a few shops are moving to. The same resources get valuable exercise applied to a company's own product.
Sometimes, what starts out as a sideline eventually takes over and what was once a job shop becomes a full-time product manufacturer. Or the sideline is spun off as a separate company.
Starting a product line isn't for every shop. The biggest hurdle is simply finding a winning idea, although having a functioning job shop business as a platform from which to launch a new product can make the risks more manageable.
As an opportunity for growth, a product line has much to recommend it. Who knows, the start of one could be out in your shop right now, lying on top of a tool chest, something that a veteran machinist came up with years ago. Go look for it!
