Outfitted for Success – How to Plan for Production Growth in Your Small Businesspbfycom
As your small business grows from homemade hobby to legitimate business concern, you and everything related to your business has to grow also. In order to meet the growing demand for your product, you have to increase your production and expand your reach. Here are some tips to help make the transition a bit easier.
Depending upon how many direct or third party sellers you have lined up, you may have a pretty good production target. The idea is to think big, but not go overboard. Especially with food items. The last thing you want is for your product to languish in the warehouse or your garage storage going stale for lack of sales. Try to estimate your production run as closely as possible to the orders you have, then choose a percentage over. You never want to run short. If a store you’re supplying should sell out, you want to have stock on hand to deliver more. Small producers have to be especially careful about this. You want to think about 5 percent as a stock on hand amount. That number can grow as demand grows. On the flip side, if you don’t have that stock on hand and your store sells out, there’s always a large company that can ship a product to replace yours, and then you’ve lost that opportunity.
If you’re a home-based business or own or lease a small commercial space, you have to consider size. You need storage for raw materials, a packaging and shipping station, the production line and storage for warehousing your product. When looking for your storefront or factory, consider the space you will need. The kitchen must be of adequate size to accommodate the appliances your need whether it be mixers, ovens or refrigeration units. All of these items take up space. You also have to consider how many staff members you might have when you are in full production. You’ll need sinks and dish washing space as well as restrooms and an employee break room, storage for janitorial and paper supplies, and office and accounting space. You might be able to start out from home, but if you truly want to have a successful growing business, all of these factors must be included when looking for a commercial or industrial business space.
As your business grows, your need for greater supplies of raw materials and ingredients grows. The recipe that once required 10 pounds of flour now requires ten times that amount. This means that you have to find a way to buy your raw materials in bulk to save money and meet production demands. If your ingredients require refrigeration, this is also something to keep in mind. Appliances will need to be large enough to do the work and to store ingredients and the finished products.You’re going to be moving up from restaurant supply and big box stores to wholesalers and professional food purveyors. These vendors understand the bulk market, and can get you the raw materials you need to increase production of your product. Be aware that new customers are often run on a cash basis before credit is extended, so be sure to find out the details and requirements for obtaining your raw materials in bulk.
Kitchen tools and appliances
It may be time to say goodbye to the trusty Kitchenaid and the kitchen itself. Growing your business means larger batches and that means larger appliances. You’re going to have to think about tools that will be able to handle the volume of product that you expect to produce. There’s nothing worse for a fledgling business than to have the production line go down due to equipment failure. This could spell doom for your new company should you be unable to meet production deadlines. Make the investment in your company’s future by purchasing the appliances and kitchen tools that will hold up under production demands and do the job properly.
Another aspect to consider is how the product will get from your production line to the customer. Will it travel by mail, by shipping , or by truck transport to local stores? What ever mode of delivery you choose, make sure you have it dialed in before the first shipment goes out. A customer who doesn’t get his product delivered is an unhappy customer. That customer will tell his friends about his experience, and you have 2 strikes against you right out of the gate. Make sure that you have the best shipping and delivery system you can afford in place to avoid unhappy customers.
Growth can be expensive and sometimes painful, but you’ll never know if you can succeed until you make that leap to take your company to the next level.
PBFY can help you when you’re ready with a wide variety of flexible packaging solutions! Check out your options!