Adapting to today’s customer

Welcome to the start of another year, where machine shops will be pushed to adhere to even stricter standards as customers deal with consolidation, relocation, certification, lean-system implementation and other versions of doing more with less.

Towards the end of 2014, customers were as demanding as ever—a result of unpredictable markets and an unstable global economy. Machine shops will have to keep carrying customers’ burdens. Customers expect us to provide detailed quotations quickly, control costs, pass on savings and meet increasingly stringent requirements—all while trying to make sense of sometimes fuzzy specs, part design problems and drawing errors.

This transfer of accountability has required even the smallest shops to evolve and adapt to the demands of global markets and international standards. Of course there are shops where international standards aren’t exactly a priority, but with so many customers marketing and selling globally, dealing with those standards has become a necessity for long-term survival.

In December, I convened a meeting of our key employees, supervisors and managers to review several year-end jobs. One important subject was preparing for a visit and audit from a high-profile energy company. We were looking to gain approval on a new project that consists of a new product line with a final test procedure as part of the QC process. The decision to pursue the project required us to go outside of our normal range of services, creating some uncertainty among our team. Nonetheless, with the realization that the “gravy” work of the previous couple of years is slowing down, getting new business is critical.

We got through the preliminary formalities and hope the project will be successful. However, to be approved as their supplier, we had to agree to meet several, standards and specifications, all to certify the product for a global market. Much of the information wasn’t easy to interpret, and the customer was sometimes confused about their own requirements. Even so, our job isn’t to complain and make excuses, it’s to figure out a solution at an acceptable price and use the opportunity to further embed our shop into the customer’s supply chain, making it difficult to transfer the work to another shop.

In another example, we have a contract with a key customer to make, stock and ship proprietary parts. Our customer reassigned and retired several longtime employees who handled the contract and replaced them with one inexperienced employee. This created frustration and delays with their customers. Eventually, some of their customers discovered we actually make the products and pleaded with us to sell directly to them.

We conveyed their concerns to our customer, but the situation still isn’t resolved and our customer doesn’t seem to have a plan to correct it. This means our shop could lose business if our customer’s customers source elsewhere. Ultimately, someone else’s purging and downsizing resulted in additional responsibilities being thrown into our lap, at the same price.

Demanding customers aren’t new, but with current market pressures, their complicated issues become ours. Is your shop ready for this scenario in 2015? Machine shops large and small, certified and uncertified, will feel the impact—ready or not. CTE

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About the Author
President of Crow Corp., Tomball, Texas, a family-owned company focusing on machining, metal fabrication and metal stamping.
kjennings@jwr.com