• Changing Compliance Regulations & Traceability
• Relevance
• Skills Gap
• Healthcare
• Environment Concerns

The industrial and manufacturing sector keep evolving and that evolution doesn’t just happen. It’s almost always a direct result of overcoming the challenges that threaten the very existence of the sector. So, are there any challenges that the sector is dealing with currently?

Well, here are 5 challenges the manufacturing sector is currently trying to overcome.

Changing Compliance Regulations & Traceability

Changing regulations have always haunted manufacturers. But, they’re there for a good reason. Without compliance standards, manufacturers could very well end up cutting corners, which ultimately ends up affecting the end consumer.

So, for the sake of things such as quality control or proper waste management, compliance standards need to exist. However, complying with new standards isn’t an easy task for manufacturers. More often than not, they’re a burden and thanks to globalization, manufacturers are also forced to deal with regulations that are unique to each territory.

Manufacturers are also tasked with tracking compliance as well. This means that have to go through the entire supply chain to check for compliance, right from vendors to the end-product that’s sent to the customer.

Relevance

As technology evolves, the rate of innovation increases. But, this also means companies have to rush and that can lead to all kinds of temptations. The urge to skip a step or avoid certain tests can be hard to resist when the goal is to market the product as soon as possible.

But, the last thing a manufacturer needs is to put the business at risk with a low-quality product. So, innovation management becomes a must in these situations. Preferences change by the day and any delay in delivering appropriate solutions can mean the end of everything.

So, manufacturers have to establish a system that allows for the consistent delivery of new ideas and innovation. Only this can sustain manufacturing success.

Skills Gap

As one generation exits the workforce, it makes way for a new generation of workers. This transition is, in itself, quite a challenge. But, things are very different today.

Manufacturers face the challenge of filling up those positions with equally skilled members from the current generation. However, the new generation of employees is simply not skilled enough, making the challenge even harder to overcome. As a result, manufacturers have to develop strategies such as working with the education sector to offer the skills training necessary to fill these positions.

Some manufacturers are also retaining skill by extending the retirement age.

Healthcare

As healthcare costs go up, it becomes very difficult for manufacturers to manage their budgets. For instance, in the US, it’s manufacturers who foot healthcare bills for their employees. But, with costs going up, it is simply not feasible and there are no viable alternatives.

Environmental Concerns

Regulations with regard to sustainable and environmentally safe processes and practices put more strain on the manufacturing process. Whether it’s waste disposal or the regulation of materials, more resources are needed to follow best practices.

As you can see, it’s not exactly easy for the industrial and manufacturing sector. However, manufacturers have to figure out a way to leverage technology and innovative ideas to keep up with the changes that pose a threat to them.

Sourcing is perhaps among the most exciting parts of the product development lifecycle. The first step is to picture a new design in the mind, then create prototypes, and finally, the product is ready to be manufactured.

However, according to majority of companies that create products, sourcing and deciding on a manufacturer can lead to the success or failure of a product. Finding a compromise between deciding on a factory to manufacture a quality product and managing logistics – like timelines, shipping and minimum order quantities – is the challenge usually encountered in developing new products. It becomes even more difficult in today’s worldwide economy to identify many factories to choose from.

The steps that need to be taken in identifying manufacturers are as follows:

How To Identify The Right Manufacturers to Work With

As a start, identify a number of factories that a business can learn more about. It would help to get referrals. A business can contact the companies with similar products and inquire about the manufacturer they use. This way, the business can discover more about this company from the outlook of someone in the same position.

At this point, a business should identify the factories that could meet their requirements and make a shortlist. When identifying factories that they will investigate further, they should ask the following questions:

Do they like a domestic or overseas manufacturer?

There are important things to consider in choosing between a domestic and overseas manufacturer. There are advantages and disadvantages to each, and it also depends on the product they plan to manufacture. They should weigh the cost, quality and speed. Most of all, they should think about their needs. Products that need to be assembled will be cheaper abroad, since they have lower labor costs. However, big parts that occupy much space in a crate will be cheaper locally. Also, shipping and duties need to be considered as well.

Do they like to work directly with the factory, or would rather work with a broker/agent that is a factory representative in the US?

The answer really depends on their needs. When they work directly with the factory, it would cost less, and they may be more involved. When they work with a broker/agent, though they will be less involved, they will be able to work through an agent whose relationship with the factory is already established. Everything depends on what is best for their situation.

Can the type of manufacturing they need be managed by the factory?

It is obvious that businesses have to be specific in identifying the manufacturer they need. For example, a factory that is working with electronics does not necessarily mean that they have the capacity to manufacture all kinds of electronic products, since there is a vast assortment of requirements involved. So, businesses should choose a manufacturer that best meets their needs.