Why not beat tariffs by lowering costs, and becoming more competitive? It will help in your “home” market, and if you can cut enough, you’ll level the playing field with trading partners. What’s more, if you’ve lowered your costs the smart way, they will stay down. Your company will be even more competitive when cooler heads prevail overseas, and tariffs are lowered.
How?
Even lean operations have a huge, hidden, pile of money waiting to be saved. Most businesses (and certainly their accountants) think of maintenance as a necessary evil. Perhaps it is, but why throw more money at it than is truly required to keep things running smoothly? Most are actually doing exactly that!
A lot of money is wasted doing the wrong maintenance, and doing it inefficiently. The result is higher costs (up to 20% higher than they need to be), and lower levels of output. By doing the right maintenance, the right way, and at the right time, we can lower costs and increase output. Cost per unit sold goes down, margin goes up, tariffs will matter less.
Have you ever had to rush parts in for a repair? Have you had breakdowns on equipment you just maintained? If you answered “yes” to either, or both, there’s money on the table.
Read this – you’ll see what I mean.
Where to focus
The underdog can win!
There are two imperatives that require attention, and you can’t just do one, ignoring the other. You need both.
One is the efficiency of work execution. Get that right and maintainer productivity almost doubles. That means that more work can get done with less overtime, fewer contractors, and less hiring!
The second is the effectiveness of what is being done by those maintainers. We know that “an ounce of prevention is worth a pound of cure”. That applies to caring for our physical assets as equally as it does for our health. If you felt sick after taking medicine and didn’t see any long term benefit, you’d stop. So why do we continue to do work that actually causes problems and fails to improve outputs?
Is the effort worth it?
Absolutely! We have worked up a number of “business cases” for doing exactly those two things. They typically show 20% or more reduction in operating costs, and 10 times or more that value in increased revenues. If you can lower your costs by 20% and increase output by 10% do you think you could beat those tariffs?
You can beat tariffs by lowering costs, and probably even more. We can help you see just how much it is worth to your business with an assessment and tailored business case.
