Moving Margins Upward

[Mojo]

I have been looking for ways to move my margins up so I am more profitable. While I am happy with where my profit margin is at I felt there was room to improve.

Since some of my materials went up this year I had to increase my prices. Not much, just enough to
cover the added expense. My competitors are the big awning manufacturers who also make fabric replacements. This is my niche market so thankfully they set the price for me. I now have matched their price but deliver a much better product by using two row stitching, superior fabric and Solarfix thread.

My back was against the wall on pricing because the big manufacturers. I could not increase my prices without causing some issues with customers and maybe losing business due to not being competitive. So I needed to look at ways to increase my margins another way. I did this by bulk purchasing materials ( buying in 30 and 65 yard lots ) which helped a little but the big increase in margins came in how I work.

I sat down one day in my shop and went through the entire process for making a window awning as well as a slide topper and found some ways to save time. It just so happens to be that by doing this I also found ways to cut back on mistakes. It was a win win and the effect was amazing. My hourly rate went from $ 65 an hour to over $100 an hour on slide toppers. It went from $ 65 to
$ 75 an hour on window awnings. I am not charging more but I am working much faster by streamlining my processes.

This increase has now allowed me the opportunity to price differently according to the seasons and slow times without taking a big hit on profit margins. It allows me to market my products through sales and pricing strategies. I now have a lot of flexibility with my pricing and I can do all kinds of different things with marketing now.

Just wanted to bring this up. if it has been a long time since you have looked at your operations, maybe you need to also sit down and look at where your processes are at and find ways to make things up things flow faster and better. I know it maybe hard for some of you guys who have been doing things a certain way for years and I admit that since I am fairly new to the business I found it easy to make adjustments in my processes. But just wanted to bring it to everyones attention with the hope it may help one person.

Do not overlook tools either. By adopting a long straight that is attached to my cutting table, a cutting groove embeded into the table and that stupid little $ 6.00 edge guide gave me a huge cut in layout and stitching time not to mention giving me a nice looking product with straight stitch lines and perfectly squared perimeters. :)

For what it is worth. :)

Chris

[MinUph]

Sounds like Lean to me Chris. You would be very interested in learning it. There are some good books and courses on it. I took a 40 hr. class a few years ago and learned allot. Pretty amazing stuff really. Works for everything from large plants to one man shops.

[Mike]

that imbeded cutting edge ive seen in joaans   but for me have have verry few strasight vuts i lay mr fabric and pattern out 16' andthe entire thing is curved like boats, for me to save time id need more room to work and that meens more money for a bigger building, so more monthly cost and more work to so to make it i hacnt decided if it worth or if there is more work

[Mojo]

Paul:

I had a client in England I was doing marketing and PR consulting to. They asked me to fly over and inspect their factory and for kicks and grins they asked me for suggestions. I flew over because I had a lot of marketing work to do for them and I wanted to go out on the road with their director and visit their clients.

I stepped onto the factory floor and spent several hours in there just observing and came out with a couple ideas. I got the ideas not because I knew their product and manufacturing process but because I was an outsider looking in and could see things that were being done that didn't make sense. To them it did make sense because they had been doing it that way for years. it is the forest for the trees syndrome.

I had my wife come out, sit in a chair and watch me make a slide topper and a window awning. She just sat there quietly, drank some coffee and watched. Later she picked up on a couple things that I later changed due to her suggestion which shaved some time off my assembly process.

I would have never thought of it if she hadn't had watched me and then advised me to change a few things. I went through my entire process later and found a few more things. It all added up. Of course I have done so many of these blasted toppers and window awnings my assembly time has without a doubt sped up on its own just through repetition.But the little time savers have helped as well.

I guess I am a bit wacked because I find all of this fascinating. It has become a game with me at times - to see how fast I can make a topper with it coming out perfect. :)

Chris

[Mojo]

Paul, forgot to mention, of all the things I lost during the numerous strokes I have had, reading is a major one. I was a voracious reader and poured through book after book. Most of them were business/marketing/PR related. At one time I had a law library in my home. My buddy, a lawyer, replaced all of his older law books with new versions and gave me his old ones. I knew contractual law better then most lawyers because I spent so much time reading. :)

I used to do alot of freelance writing and was once a columnist for a glossy magazine. I authored over 100 articles in 10 different publications and was published in 7 countries. Hell I cannot even write a paragraph now that makes sense. I am sure that is evident by the rambling mixed up posts I make here............lol.... ;D My spelling and punctuation is horrible ( thank God for spell
checker ). Now I can type a post and just look for the red lines signaling a misspelled word ( and there are sometimes a boatload of them ).

After a bad stroke in 1999 I lost my ability to read books. I can still read magazines and things on the internet but anything that is over a couple pages is a waste of time for me. I can read a book and by the time I get to the tenth page I have lost track of what was on the first two pages. By the time I get done with the second chapter I have forgotten the first one. And so on and so forth.

I miss reading terribly but have learned to adjust to it. If there is something I really need to learn then I have my wife read it and then she gives me the meat and potatoes of the instructions and skips all the other mind cluttering stuff. I would be lost without her as she is my brain trust and has the patience of a Saint.

It is amazing as my long term memory is intact and has actually increased due to the lack of a short term memory. It has been a rough road to haul but I have gotten over the worst of it and I seemed to have settled into a groove, accepting my disabilities and working around them.

My family and friends are awesome. They understand and know how to handle my lack of memory and actually help me remember things. This is why my wife has been pushing me hard about me being organized in my business and why she has gotten me to go further into the tech arena to gather resources to help me do daily chores around the shop. ( laptop, tablet, smart phone, etc. ) Forgetting orders, customers, etc. has been an issue at times. Now everything seems to have fallen into a rhythmic cycle.

It's all good here in the hood. :)

Chris

[gene]

Thanks for the post, Chris.

Great food for thought - and action.

gene

[sofadoc]

Chris:  I've been reading your posts for a few years now, and have come to the following conclusion:

If this is what you're like with only HALF of your brain cells, you must've been a freakin' Einstein before your strokes!  :o

[Mojo]

Thank you Dennis. :)

A very close friend of mine once said " Chris has a brilliant mind, followed by to many moments of stupidity ".  :P

I am the same guy who ran out into the street in his underwear to catch the ice cream truck. ( I forgot I wasn't dressed ). You should have seen the look on the ice cream truck drivers face when I stood in the road flagging him down, bare chested and smiling and waving my hand. His eyes were wide open and bugging out as I ordered a Drumstick. The poor guy was speechless. :)

My wife stood on the curb shaking her head as she brought me my wallet which I also forgot. LOL
Of all the things I have lost it is my mind I miss the most. 8)

Chris

[timtheboatguy]

Thats good stuff, I was just thinking the other day that I desperately need to get organized and stop wasting so much time. I am about to move from my basement at home to a shop and want to make things as efficient as possible. This prompts me to sketch up some shop layouts in order to remove some wasted steps and wasted time looking for tools that I put down when the phone rang!

[Mojo]

Tim:

A couple years ago when orders came through the door slowly and I had all kinds of time on my hands I developed some bad habits which slowed my production. Now days, time is everything to me, mostly it is about money and poking holes into my schedule to squeeze another order into it.

I realized I had to do something as my bad habits and slow way of doing things were costing me money. Since then everything revolves around time. The more time I save, the more orders I can squeeze in and the more orders I squeeze in the more money I make. Still, I will not sacrifice quality one iota nor will I cheapen my products to make an extra dollar. I am now enjoying a solid reputation across the US and within the RV world and I will not wreck it or ruin my business for a few extra bucks.

I had to make changes and look for ways to save time because I could not keep going like I was, sewing 7 days a week and working sometimes till 10 at night to meet deadlines. To have orders booked into June makes me feel extremely blessed and I also know this crazy business of ours can change in a moments notice and I could be back to the old days of a couple orders pouring in every month. Till then I am going to ride this horse and enjoy every moment of it.

Whoever said " time was money " is truly right.

Chris

[gene]

Try this, Tim

http://www.grizzly.com/workshopplanner.aspx

Chris: My wife mentioned awhile back that I was starting to forget to pull my zipper up when I came out of the bathroom. I told her I wasn't going to start worrying until I started forgetting to pull my zipper down after I went into the bathroom.

gene

[timtheboatguy]

Thanks Gene for that link.  Chris, I can relate, I went from a slow winter schedule to being overwhelmed with work. The quality of my work is of the upmost importance to me yet I feel that I have been compromising as a result of burning out too many late nights working. One thing I plan to do is raising my prices in order to weed out of some of the cheap skates and focus on excellent craftsmanship.

I have so much to learn!!!!!

[Rich]

Good to see someone else admit to making $100.00/hr. on this forum!
Rich

[Mojo]

Good to see someone else admit to making $100.00/hr. on this forum!
Rich

I am not always at that rate. :)

I have a type of awning called an Omega that I make that goes on older coaches from the 2000 - 2003 models. I hate them and my hourly rate ( my margin ) drops down to $ 50.00 per hour. Thankfully I do not do them all the time as they are a pain. I cannot increase my price because I am already charging alot for them.

I would just as soon not do them at all but the owners of these coaches have been left in a lurch as the manufacturer no longer supports them with fabric replacement and other canvas makers wont touch them. I could be a jerk and take advantage of the situation and command a higher price but I have never been the type of person to screw people that way. I do it as a service to the association members I do alot of work with. It is good PR for me and besides I do make some money from them. But I still hate doing them. :)

The slide toppers are my money makers and that is where I can push my margins up with speed.

Chris

[Mike]

I am the same guy who ran out into the street in his
My wife stood on the curb shaking her head as she brought me my wallet which I also forgot. LOL
Of all the things I have lost it is my mind I miss the most. 8)

Chris

well I would think you didn't have it I hate to think where you might have put it lol