In an economy that is increasingly driven by manufacturing, small and medium-sized manufacturers are feeling the pressure to compete with large-scale manufacturers.

But to start, streamline and grow a manufacturing business can feel relentless. Aside from an ultra-competitive marketplace, positioning in this market is challenging and wrought with high start-up costs and other obstacles established brands aren’t burdened by.

But that doesn’t mean smaller companies can’t compete. There are several things small manufacturing companies can do to level the playing field and even come out ahead.

Be more agile

In the business world, size matters. Large manufacturers have more resources, which they can use to their advantage. They also have established expertise, customer loyalty, trust, and budget, so they can often offer lower prices and better terms.

One way small manufacturers can compete is by being more agile. Smaller companies can make decisions quickly and without a lot of bureaucracy, allowing them to be more responsive to trends in the market.

Another way small companies can compete is by being more customer-focused or specializing in something that the big manufacturers don’t do well, such as more personalized services.

Get specific about manufacturing processes

Implementing process solutions that cater to the unique needs of a manufacturing company gives small manufacturers a competitive edge in the market. A manufacturing ERP solution improves strategic processes by using functionality and features to increase ROI and lower costs.

Dive Deeper: Getting to know a manufacturers software requirements

Small manufacturers should focus on sourcing solutions designed to meet their specific manufacturing processes instead of implementing an out-of-the-box ERP software solution developed for multiple industries.

Adopt solutions to meet specific business needs

Every small manufacturer has processes unique to their product compared to other manufacturers, even competitors in the same market. The small manufacturer understands this and knows the key to success in the competitive industry is implementing agile and customizable solutions that flexibly meet these unique requirements.

Increase support the manufacturing floor

Since the manufacturing floor is the foundation of a manufacturing business, giving them support and a voice in process improvement enhances productivity and ROI. Small manufacturers need a consistent voice representing the brand personality that helps support overcoming challenges like workforce retention and motivation. These manufacturers need solutions with clear data flow and analysis to ensure business decisions and solutions remain consistent, unbiased, and updated in real-time from the floor to top management offices.

Implement organization-wide benefits

A solution focusing only on manufacturing processes can’t drive business performance or give it a competitive advantage over well-seasoned peers. The right solution meets the functions of the entire business, including streamlining and integrating different financial and customer management processes so it can perform at a higher level than operating from separate applications.

Vendor and solution flexibility, stability

The best solution grows with your business. Small manufacturers ensure they get vendors with the capability to meet their evolving needs. As manufacturing business transitions from small to mid-sized, it might need to bring some of the systems in-house. Working with a vendor that provides this option beforehand ensures a seamless transition and investment protection amidst organizational growth.

A small manufacturer needs a vendor that can continually support the business and offer backup and support policies in case of crashes or breaches to your system. Keep an eye on how the vendor protects your data post-termination, the existence of any termination fees, and the ease of moving data ownership.

Performance management and reporting functionalities

Data is critical in manufacturing because it provides insight into the sales and distribution systems and helps to identify areas of improvement regarding supply and demand in the market, among other factors.

By helping manufacturing businesses predict supply chain trends and events in real-time, data supports business agility and adaptability. Small manufacturers need an ERP solution that collects, analyzes, and simplifies data in an easily understandable format for decision-makers and to help small manufacturers track their KPIs and performance in managing operations successfully.

Budget visibility

In manufacturing, it is common to view rising pricing as the easiest option to making a higher profit margin. This means finding solutions that favor their budget, cash flow, and bottom line for small manufacturers.

It also means finding a vendor that offers pricing protection, whether they provide a subscription-based pricing model or not. As a result, any price increase is communicated before implementation, and the small manufacturer can prepare for the changes beforehand.

Growth in Manufacturing

Although small manufacturing companies face enormous challenges, there are ways they can level the playing field. One way is by offering niche products or services that the more prominent manufacturers don’t provide. Small manufacturers can compete on price by being more efficient and having lower overhead costs. Or, small manufacturers can be more agile and responsive to changes in the market.

The moral for small manufacturers is that they don’t necessarily have to work harder, they simply need to be more efficient. To compete among high-level manufacturers, small manufacturers must practice agility and sustainability.

This requires the implementation of solutions that support scalability and operational efficiencies. Achieving this level of preparedness requires small manufacturers to source vendors that meet their unique needs to gain the resilience needed to compete.

FAQs

How can small manufacturers compete with big brands?

Small manufacturers can gain a competitive advantage by implementing business solutions that focus on their business needs, such as getting vendors that understand internal and external organizational needs and offering functionalities that meet them directly.

What is the challenge small manufacturers have when competing with big brands?

The manufacturing industry has high start-up costs, and targeting an audience already loyal to the big brands is challenging.

How can small manufacturers sustain their competitive advantage?

Small manufacturers can succeed if they find solutions that help them meet their specific needs and the needs of a niche market. Focusing on a narrow market immerses a following that allows the small manufacturers to scale and grow with time.