January 21st, 2021
Staying Ahead of the Curve
It is the start of a new year and a new race for superiority in the marketplace. Door and window manufacturers are just exiting the starting gate. So, in 2021 what factors will help win the race? There are three:
1). Lead Time
I asked a handful of my window customers if I order windows today, when would they be installed? The earliest answer I got was April and the latest was June. In the eyes of the customer, this is an issue. Therefore, window fabricators that can address this lead time issue will gain a considerable advantage over their competitors.
There are several ways to address this. One is to add a second shift. With labor availability a real concern these days, this is easier said than done. Second or third shifts offer less desirable working schedules that are even more difficult to staff. Production output and quality is also more difficult to maintain on second and third shifts. A second option is to buy equipment and add another production line. This option presents challenges as well. Lead times on new equipment are quite long these days extending out six to nine months in some instances. An extra production line also means extra people which need to be trained from ground zero. Once again, we get back to the people issue. A key issue here is that both options also involve an increase in the required volume of raw materials and components. But with many suppliers being stretched to their limits, also because of people issues, there is no guarantee that you will be able to obtain these additional volumes of materials necessary to feed the extra production shift or additional production line.
The third option is to increase the output per man-hour of your existing production line. This is the best option due to the labor availability issue previously mentioned. An investment in automation usually does not mean hiring more people. In fact, it could mean using fewer people to make more units per day, while reassigning some of the people on an old line to another operation in the factory that is experiencing a void of manpower. The problem with automation is that if you did not think of this option six to nine months ago, then you will be six to nine months behind the curve if you are just now coming to this realization. Last year, when the pandemic first hit and orders for automated equipment were being canceled, Morgan Donohue, vice president of Erdman Automation was interviewed by [DWM], and he predicted that interest in automation would be back with a vengeance. Morgan was so right!
When the supply side of the market is strained, one thing that typically suffers is quality. Production teams are strained to the limit. Equipment is strained to the limit. With people being in short supply and turnover rates high, there is a constant pool that needs to be trained and not much time to train them. In many cases the people training them are not fully trained themselves. It is a recipe for quality disaster. Fabricators that can keep high quality levels despite these challenges will maintain a competitive edge in the marketplace. Once again, automation here offers a huge advantage. The fewer touches that are made to works in process the better. Each time a human being touches a component during the fabrication process, it increases the percentage of the overall failure rate in the field.
If you are going to make customers wait longer to receive your products, it sure helps if you can add innovative features, thereby differentiating them from the products marketed by your competitors. Is there a better lock, hinge, operator or even an electronic component that you could be using that adds ergonomic features to your door or window system, or a better spacer system that enhances the thermal performance or increases the life expectancy of the insulating glass unit? These components can add valuable consumer benefits that can set your product apart from the competition. Providing extra features for a modest increase in price adds value to your fenestration offering. Adding innovation can make your door or window worth the wait!
It is now apparent that 2020 threw a huge curve ball at us. It was like a changeup pitch in baseball. Many companies reacted with layoffs and slashed capital equipment budgets when they should have been doing the opposite. So now we find ourselves with a challenging year ahead of us. However, all would agree that things are challenging in a very good way. So, embrace the challenge and stay ahead of the curve!