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Tony Hague, managing director of PP, gives an insight into how UK machinery builders can ‘China proof’ themselves against lower cost replicas.
We’ve heard it many times before and now many UK machinery manufacturers are seeing it first hand…the threat of the Far East replica.
This increasingly common threat – once only reserved for the higher volume component producers – is now taking a firm stranglehold on the OEM sector and is not only threatening to curtail export orders into Asia, but is also beginning to erode into traditional European and US markets.
Copying some of the basic machinery processes is helping rivals in Asia deliver replica OEM machinery – in a wide range of markets – that deliver a level of performance that is typically less effective than the European manufactured models.
However, they are offering these machines at a significantly lower cost resulting in many of the end users seriously considering their purchasing options.
The ROI (return on investment) is still hugely important, but the gap is shortening and UK manufacturers need to take this into consideration. And the response needs to be quick.
Complacency and lack of investment has not helped the trend and it’s time now for machinery builders to take back the advantage by innovating their process, products and marketing.
Managing director of PPES, Tony Hague explained: “We have to focus on delivering competitive advantage with our customers…whether that be through design innovation or superior quality, which in turn leads to improved machine performance, flexibility and machine “up” time for the end user.
“Equally through strong design for manufacture and value engineering, we can work with our customers to reduce their production build times, reduce overall costs and improve lead times to their customers.
“However, this doesn’t just happen overnight and we have to play our role to ensure we remain as productive as possible by looking at continually improving the capabilities of our machines…the latter might be achieved by strategic outsourcing and focusing on your core activities.”
He continued: “This is where an organisation like PPES can help. By building strong relationships with our clients, we can review their current manufacturing capabilities and look at where we can add value or take cost out of the equation. In some cases, it may just be a capacity issue that we can solve.
“UK machinery builders can lay claim to strong brands, but they have to protect the gap between the difference in performance benefit versus the lower costs offered by the Far East.”
Selecting PP as an outsourcing partner can offer:
Material costs and supplier leverage – By combining the customer’s needs with our own supply chain requirements and relationships, we can create cost down opportunities within the bill of materials.
Technical Expertise – PPES’ knowledge gained by working with many world leading machinery builders is combined with the engineering prowess of our technical partners to design innovative solutions that reduce manufacturing costs and enhance performance.
Compliance expertise – Our knowledge and capabilities around UL and cUL standards, mean we can offer advice and solutions for machine builders specific to industry sectors or sales geographies, such as North America.
Design for Manufacture (DFM) – PPES has developed an unsurpassed level of expertise in DFM. Acquired over a period of 20+ years, this combines with production engineering skills and lean manufacturing principles to improve machine design, lower manufacturing costs and increase reliability for our customers.
Production expertise – The use of automation for cable preparation (including crimp force monitoring technology), poke-yoke manufacturing, automated test equipment, torque tooling and six sigma principals all contribute to improved quality for our customers and the ability to ensure optimum machine performance.
Hague concluded: “Competing with Far East manufacturers of machinery is not impossible, we just need to be clever about our strengths and then invest heavily in marketing what makes us better…especially in regards to long-term return on investment.”