The Ultimate Checklist for Ambitious Manufacturing Startups
So, you're an ambitious manufacturer, ready to shake the e-commerce market up with a brilliantly innovative product?
Well, hold your horses for a moment, because as much as we love the passion there’s a lot more to becoming a successful manufacturing startup than just drive.
The modern manufacturer has to account for sales, marketing, branding, production as well as the daily burdens of business. That’s a lot of responsibility to take on, and not to be taken lightly, whether you got investors behind your back or not.
If you don’t do your research thoroughly beforehand and spend your budget wisely you might well end up like this guy. He thinks he looks cool but really, he’s just burning his future into the atmosphere.
Instead, it’s better to set yourself up for success by building a foundation worthy of your product. It’s going to take time to get all of these elements in place but don’t worry, you don’t have to focus on them all at once.
Just make sure that you don’t neglect any of them as your business takes off. Future you will be thanking present you soon enough.
So, what are these essentials?
1. Choose the Right Software
The first thing you want to do is make sure that you have the right tools to back your aspirations. It’s easy to keep up with your daily operations at the start when your business is just getting set up. The spreadsheets are all laid out and good to go.
But the reality is that nothing ever goes smoothly in manufacturing. Problems will arise, demand will fluctuate, your product needs to adapt, and customers need attending to. And that’s not even mentioning the marketing and sales efforts needed to scale your business.
Spreadsheets might work at first but trawling through a web of spreadsheets to find answers in a fast-moving business environment is less than ideal. That’s why you need to make sure you use software which streamlines your daily operations and gives you the time to focus on growing your business.
Katana is an all-in-one solution designed for startup manufacturing companies that want to scale fast. It streamlines your inventory, production, and sales from a single visual, color-coded dashboard.
It allows you to follow your order fulfillment process from start to finish in real-time. Decisions can be made quickly based on automatically updated data and you can spend time focussing on your scaling your manufacturing startup.
This is the kind of tool you’re going to need if you want to be putting your invaluable energy in the right places.
2. Compare Yourself with the Best
In your everyday life, it might not be the best idea to compare yourself and successes to other people. We all have our own journeys that simply cannot be put side by side fairly.
But from your businesses and products point of view, comparing yourself to competitors can only be a good thing. You can quickly see what works, how they present their products and how they brand themselves.
The point here is not to copy what they do but try to learn why they do what they do and build from there. If their logo features a distinctive font, for example, you should be considering why they are doing that?
Is it because it gives the feeling of being traditional? Friendly? Stylish?
These are the kind of details you should focus on.
Get creative when it comes to gathering thoughts, insights, and data on your competitors. You could even go undercover at trade fairs and chat to them directly if you want to get really sneaky.
But, more importantly, you need to be one step ahead of other startup manufacturing companies by monitoring their strategies and campaigns. 79% of businesses believe timely intel to be critical in excelling against rival competitors.
That’s because markets can move very fast, so you need to be capitalizing on trends your competitors are picking up or you’ll fall behind.
3. Bring Your Mission to Life
One of the biggest shifts in consumer behavior as of late has been the move towards buying directly from manufacturers. And a great factor to this change comes from the desire to buy from honest and transparent businesses.
That means that people want to hear your story, why you make your product and how it’s done. Just delivering a great product on its own simply doesn’t cut it anymore.
Everlane, an ethical clothing maker, is one of many manufacturing startups that recognized this early on. Now they use the approach of radical transparency to create that bond of trust with their customers. So much so that they include their costs and mark-ups on their website.
The founder, Michael Preysman, sees this as “...an opportunity to bring the mission to life… the ethics, the transparency. We tell you the cost of everything we make and then what you're paying so you can see that markup and we tell you the stories of our factories...”.
Now, we’re not saying that you need to take your business to this extreme of transparency. However, do remember that people want to be buying from a business that cares about their product and the effects it has on its environment as much as they want to sell it.
So, if your product is concerned with our planet’s ecosystem, highlight it.
If it’s going to improve the customer’s health, let’s hear it.
If there are some interesting people and processes behind the scenes, then show it.
And if it just makes you happy to make it, then tell your customers why. These stories will make all the difference to your manufacturing startups success.
4. Analyze Your Costs
One of the main difficulties for startup manufacturing companies comes with keeping on top of costs. Because the truth is that raw materials, labor, and manufacturing overheads are not always as fixed as we would like them to be.
Suppliers can change prices and plenty of times there will be errors and delays to account for. Staff can walk in and out the door. Equipment can fail and increase your costs.
And it’s important that you have a real-time view of your manufacturing costs so that you can price your products correctly and adjust your processes when needs be. Otherwise, it’s going to be tough to get your manufacturing startup off the ground.
Now, you have two options here:
Spreadsheets might seem like the first port of call when it comes to calculations of costing. After all, how hard can it be?
But think about how many separate sheets and equations you’re going to need to keep on top of your costs whilst also maintaining your production. Because as well as tracking fluctuating costs, you also have to account for a constantly moving flow of stock in and out of your inventory.
That’s why it’s going to make a lot more sense for you to adopt Smart Workshop Software which will automatically manage your small business inventory as well as updating your costs automatically based on your product recipes and operations.
This way you can make quick decisions based on the live costs of your products, rather than relying on lagging spreadsheet calculations and gut feeling.
Regardless of which route you take though, the main point here is to make sure you stay on top of your real costs so that you can make effective business decisions. Every buck adds up and it’s easy to lose sight of your profits if you don’t manage your manufacturing costs efficiently.
5. Test the Waters
The subtle art of preparation seems to have been laid by the wayside in recent years. It must have something to do with the intense pace our world seems to be moving at.
But that’s no excuse for manufacturing startups to go burning money on misplaced initiatives. From marketing to production, it’s vital that you test the waters.
You want to try out all of the different marketing channels available to you to see what works best.
Here are just a few ideas:
Influencer marketing - don’t worry you don’t have to spend big here. Just look for micro-influencers whose audiences best match yours.
Email marketing – set up polls, surveys, and competitions so that you can gather potential customer data. This way you can quickly communicate new ideas and products, getting valuable feedback along the road.
Content marketing – we already mentioned how much customers value hearing your story. It’s the same thing when it comes to hearing about your product and its industry. Just think about what information would be of use to your customers, and make it happen for them in the form of blogs, videos or even infographics
And the same logic applies to production. You want to make sure your manufacturing scheduling processes are in order before demand increases.
Run a few test production lines and see how your business would fare under pressure. If all is well then you’ll gain confidence in your manufacturing for the future, and if not then you can smoothen your processes before the real orders come in.
6. Take Care of Your Customers
We already know that 55% of customers are willing to pay more for better customer experience. But the truth is that expectations now are as high as ever and manufacturing startup companies best hold up to these standards.
Because a solid customer experience means more than just offering passive support. Now it’s a matter of being proactive and creating a dialogue with customers to make them feel listened to and accounted for.
As mentioned before, offering valuable content in the form of guides, blogs and videos is a great starting point.
But it’s always better to go direct to customers with live chat options and social media. There are plenty of tools available for an e-commerce website which will allow you to place a live chat option and give visitors the opportunity to ask questions on the go.
And if this sounds too resource-heavy for you, then you can always try to engage customers on social media. Create a buzz with your posts and then follow up by interacting with people’s comments.
This kind of dynamic strategy is going to be vital to the success of your manufacturing startup.
We’d be lying to say that this checklist is the be-all and end-all for manufacturing startups.
Bypassing the middlemen and going direct to consumers means that there are plenty of responsibilities to take on and it can get overwhelming fast.
But following this guide will certainly put you on the right path, and at the very least highlight those areas your business needs to focus on.
And on the bright side, you shouldn’t forget the greater possibility and potential for growth that these added responsibilities provide. After all, that’s what got you into the manufacturing startup world anyway, right?
Just remember that you are going to need the right tools to make sure that you have the time to concentrate on your product, customers and marketing efforts. Losing sight of these elements can get you sidetracked quickly.
We already mentioned how Katana can unify your order fulfillment process and make sure your inventory, production, and sales work as one. The set-up process has been made simple, and the color-coded design of the software has been designed to keep things that way.
But that’s just the tip of the iceberg.
Here are a few key benefits:
On-demand access to your manufacturing costs;
Finished goods and material inventory;
Use as a production scheduling software;
Sync accounting with your QuickBooks MRP;
Plan your material purchasing efficiently;
Ditch inefficient excel spreadsheets forever; and
Keep your entire business workflow on a single dashboard.
Katana is a tool which has been designed for startup manufacturing companies that want to be running operations as efficiently as possible so that you can zone in on growing your business instead.
But ultimately what you need to remember is that not everything needs to be done at once. Take your time and go through the checklist, measuring each issue as it comes along.
Next thing you know, you’ll have your manufacturing startup flowing effortlessly, and the days of needlessly burning cash will be far behind you.
A slither of smoke on the horizon.