These days, businesses in the manufacturing sector face an uphill battle when it comes to competition. Many years of globalisation combined with the removal of import tariffs has meant that the export industry faces stiff competition from overseas companies that can produce much more cheaply. Indeed, very few or non-existent labour laws in many of these countries means that they will always be able to forge ahead when it comes to undercutting on price.
Competing on a Level Ground
The simple fact is that local businesses need to cut costs in order to compete with global companies. This has certainly caused the closure of many older businesses but the good news is that new technologies have opened up that have provided new opportunities.
For example, precision engineering companies are now able to compete on a much more level playing field due in large part to their innovative technologies and techniques. A big driver in this business success is in providing affordable parts for high-quality devices that are growing ever more popular with consumers, such as smartphones, tablets, and other electronics.
How Else Can Local Businesses Compete?
So, apart from engineering and innovating in the area of smart technologies, how else can local businesses compete with their global counterparts? One might suggest that the only way to do this is to cut down on costs, beginning with employment. The problem with this approach is that it only leads to a slippery slope. Once employees are cut, it is only a matter of time in most cases before the business itself loses dynamism and shuts its doors. Indeed, employees are the lifeblood of any business and should not bear the brunt of a globalised marketplace.
One of the best ways to cut costs and still remain competitive is to look at the costs associated with maintaining tools and equipment. This costs the average company many thousands of dollars per year. These costs would be better spent in marketing and new business directions.
Cutting Costs through Cooperation
Companies that offer precision machining in Perth can provide local businesses with an advantage. By providing high-quality CNC machined parts, they can work with business leaders to cut down on costs. This working relationship provides the following business advantages:
- Lower maintenance costs for replacement of crucial tools and parts because they can be machined locally
- The opportunity to reverse-engineer OEM parts in order to save further money on parts and tools
- Supporting another local business so that the local economy remains buoyant
The fact is that Australian business faces stiff competition from overseas business that can manufacture products more cheaply. This will not be changing in the near future but it is possible to lower costs smartly by supporting other local businesses and working with them to produce precision machined parts.