
What is Manufacturing and How can it Drive Sales?
By better understanding the manufacturing process, you can harness it to increase sales. Let’s explore how to do just that.
By better understanding the manufacturing process, you can harness it to increase sales. Let’s explore how to do just that.
Manufacturing is the process of turning raw materials into finished goods ready to sell to customers. It’s a carefully planned combination of human labour, machinery, and equipment that creates products efficiently and at scale.
‘At scale’ is the key point. Rather than spending days making a single product by hand, modern business manufacturing plants use automation and production lines to create thousands of products simultaneously.
Manufacturing is an integral part of the economy. The value added through manufacturing in Australia alone is projected to amount to 96.5 bn (60.4bn USD). That's nearly 100 billion dollars of value added to the economy through raw materials and components.
Manufacturing is also important for businesses. It lets you get your goods to market more quickly. Efficient manufacturing also allows you to benefit from economies of scale, meaning you can produce more units for less. Both of these benefits contribute to more sales and, potentially, higher profit margins.
Manufacturing isn’t one-size-fits-all. There are dozens of different production methods and types to choose from, which means you’ll be able to find one that best suits your business.
Manufacturers are generally divided into three camps: Make-to-stock (MTS), make-to-order (MTS), and make-to-assemble (MTA).
Before deciding which manufacturing methods are best for your business, it's helpful to determine your preferred approach — MTS, MTO or MTA.
In addition to different approaches to manufacturing, there are also several manufacturing process types to consider. Every business has different needs, so assessing the variants and deciding which is the right fit is important.
Discrete manufacturing involves carefully monitoring and identifying the raw materials used to create each product. It uses a bill of materials to ensure that every component is tracked and accounted for.
This type of manufacturing is essential for businesses where the parts of a product are as important as the product itself. The automotive industry is a good example, as each car component must be identifiable and recordable.
You'll also see this type of manufacturing with electronics, where each part of a phone or computer must be accounted for to ensure the device works as intended.
In process manufacturing, factories produce goods using a predefined formula. Think of it as a recipe for creating products in bulk. Each step adds a different ingredient, culminating in an end product distinct from its components.
Process manufacturing can further be split into two categories.
Hybrid manufacturing combines elements from discrete manufacturing and process manufacturing. This is most common when the core product is created using batch processing before being handed over to a new team to be personalised for a business.
For example, a factory may use process manufacturing to create a chocolate mixture for a confectionary company. The manufacturer then switches to a discrete method to carefully assemble, package, and brand each bar before sending it to the customer.
There are other, more niche manufacturing types.
Despite the different types of manufacturing approaches and processes, the steps that take a product from conception to distribution follow a similar path.
The first step in the manufacturing process is coming up with a product idea. Asking yourself the following questions will help you design and market your product. It will also support demand forecasting in the early stages of production planning.
Next, come up with a design for your product. This step takes an idea and transforms it into a reality. The more information you have at this stage, the easier it will be to pitch your product to a manufacturer.
Once you’ve gathered your information, make a prototype. You'll need to create a single version of your end product, test it to ensure its functionality, and refine it if needed.
This step is essential. It's much easier (and more cost-effective) to find problems with your design now than to learn you have a defective item after you've begun manufacturing products.
Production planning involves working with a manufacturer to determine the roadmap for turning your design into a finished product.
You can’t ‘overdo’ a large-scale production plan. The more information you have before you start creating goods, the more troubleshooting you’ve done, the more reliable and productive your processes will be.
Now, you’re ready to start manufacturing. Follow the strategy you’ve mapped out and identify any additional considerations. For example:
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Once your products have been created, it’s time to ship and send them.
Manufacturing is a living, evolving process. To continually improve, you need to evaluate and refine your manufacturing process, adapting and pivoting as needed. Analyse whether expectations are being met, monitor your supply chain, and view sales data to forecast consumer demand effectively.
Harnessing existing technology can help you do this easily and efficiently. The Salesforce platform, for example, combines all of your manufacturing and business data in one place, allowing you to identify supply chain inefficiencies, predict customer demands, and seamlessly optimise your manufacturing processes.
New Zealand dairy company Fonterra is faced with the challenge of farming and processing milk at scale. This is no easy feat. Milk is susceptible to external changes, and even the slightest hiccup in the production process could render an entire batch undrinkable.
Fonterra's approach to quality control starts well before the raw milk reaches a processing plant. The produce is collected daily and stored in cold vats on local farms to keep the milk fresh. From there, tanker drivers collect the produce and send a sample of each batch to Fonterra’s laboratory for health and safety tests. If the milk fails the test, the entire tanker is discarded.
This is the first of many quality control checkpoints the brand employs. Upon arrival at the manufacturing site, all milk is tested again to ensure it is free from antibiotics and growth hormones.
Image source: Fonterra
The first stage in Fonterra's manufacturing process is pasteurisation. The raw milk is heated to and cooled to kill any low-level bacteria. From there, it is passed through a separator, which separates the cream from the milk. This also gives the manufacturer the opportunity to adjust milk fat percentages for different products. Quality control experts then test the milk once again.
These are the early stages of Fonterra's multi-step manufacturing processes. Some batches will be bottled and branded to sell to customers, while others will be turned into dairy products like cheese, butter, and ice cream.
The manufacturing sector is always evolving. Here are three trends that will shape the future.
The fourth industrial revolution is upon us. Manufacturing businesses are beginning to invest in robotics and automation at large to increase efficiency and cut manufacturing costs.
Data analytics will play a huge role, allowing businesses in the industrial sector to collect and analyse sensor data to improve and optimise every aspect of a manufacturing plant. Industry 4.0 is set to be the biggest manufacturing race of the last 50 years.
More than 70 percent of shoppers expect personalisation , meaning businesses and manufacturers have their work cut out to provide these experiences.
In many manufacturing industries, there has been a shift away from mass production. The adoption of robotics, 3D printing and data analysis will mean organisations will be more agile and flexible when offering personalised manufactured products to meet customer needs.
More than half of manufacturers believe that sustainability is essential to the future. Amidst climate change, creating circular economies (recycling, reusing, and manufacturing unused materials and goods) is essential to reducing environmental impact.
In addition, promoting sustainable logistics and ethical practices will continue to be a top concern for manufacturing leaders — and customers.
Manufacturing has its complexities, but when you get it right, you can create products at scale for less. This will help you improve margins and drive more sales. It will also help you bring your big ideas to life.
If you want to stay on top of productivity, you’ll need to choose the perfect manufacturing techniques, plan your strategy, monitor your progress, and constantly adapt to improve.
How Salesforce can help? With the Salesforce platform, you can gain 360-degree visibility over your entire supply chain and build a unified view of your products, data, and customers through the entire life cycle.
Our solution will help you forecast future demand trends based on historical sales data, gain insights into your supply chain efficiency, predict potential delays, and receive AI-driven recommendations to optimise stock levels and mitigate manufacturer risks.
View the demo playlist to see Salesforce in action, or browse the full list of Salesforce products today to find out how we can help your business.
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