The manufacturing industry has become one of the leading global industries and one of the cornerstones in the US economy. This industry is rapidly growing driven by innovation and implementation of emerging technologies such as artificial intelligence and machine learning.
As your manufacturing business grows, it will become more challenging to manage. Businesses considering outsourcing their manufacturing is a major decision to make, so as a manufacturer, you need to have a strong reputation, swift production process, and high-quality results to attract these businesses.
At Frontier, we’ll look at your main market and your business standing to help you understand what’s at stake and lay out strategic solutions for you to make your business decision-making as flawless as possible. We will help you address gaps in the industry supply chain and look into market entry opportunities, process optimization, and growth expansion.
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I. Frontier Manufacturing Industry Clients
The manufacturing industry is a huge driver not only in the production of goods but also in the creation of new jobs. As a decision-maker, balancing a large workforce with the demands of optimizing production, generating revenue, and continuing to grow is a challenge. Being the one responsible for the creation of products, it’s one of the main contributors to the success in this business.
Frontier works with a number of clients across manufacturing sub-specialties, such as:
The automotive industry is the largest segment of the manufacturing industry. The demand for new cars is strong and market innovators such as Tesla are winning in the electric vehicles category. Forward-thinking topics like sustainability, electric-vehicles, and concerns about climate change are pushing clients in this industry to consider new strategies to stay relevant and retain consumer-trust.
Metalworks is divided into machinery processes, like cast steel, aluminum, iron, gold, and other steel pieces to create a finished part or product. The highest revenue of a US-based company, Nucor Corp. is valued at 20 billion in 2020.
Clothing and Textiles
The clothing and textiles industry processes raw wool, cotton, and flax into usable fabric. This industry has transformed into a major industry in the last few decades. This was influenced by the development of new technologies and innovations which made it possible for them to produce on a larger scale. Ingredient brands have been challenged to address consumer concerns surrounding corporate social responsibility (CSR) and environmental sustainability.
Petroleum, Chemicals, and Plastics
The PCP industry or petrochemical/oil industry is involved in the production of products, including fuels, lubricants, petrochemicals, and plastics. This industry has a controversial background as a major contributor to greenhouse gasses and other environmental hazards. Companies today are driven to switch to more environmentally friendly and sustainable solutions.
Electronics and Computers
The electronics and manufacturing industry includes the creation of electronic parts, repair, and recycling of used electronics. It’s a multi-billion industry as the world changes to become more updated with technologies, computers, mobile phones, scientific instruments, and defense equipment. This industry has a high demand for workers and is set to increase even more as the economy grows.
The food production industry is responsible for producing, processing, distributing, and selling food products and ingredients to the world’s population. The food sector is an interdisciplinary process that requires a deep understanding of agricultural sciences. Raising livestock, farming and fishing are the main areas of this sector but it also includes food processing and manufacturing of agricultural supplies.
Wood, Paper, and Leather
One major challenge for manufacturers of the pulp or wood and paper industry is the concern with its environmental effects such as deforestation. The leather industry, on the other hand, may encounter issues with livestock management that will influence the quality of the raw materials supply.
The businesses in this industry need to be proactive in supporting sustainable practices as social and environmental factors are becoming part of the purchasing decisions of consumers.
What is Manufacturing Industry?
The manufacturing industry includes all transformation of tangible goods from raw materials. It’s sometimes referred to as the production industry or industrial sector.
A lot of businesses look for ways to be more efficient and gain profits. However, some of them struggle to keep up with high customer demands and deal with continuous new product releases. This is where Frontier comes in.
Businesses are outsourcing to manufacturing companies to cut costs and to meet consumer demands in a timely manner. Manufacturing companies deal with the assembly of individual parts into a final, sellable product, though they are not always the ones to sell it. As consumer mindset shifts, so too do manufacturers need to consider what their clients are buying to deliver to the end-user.
With its outstanding range in the market, this industry also deals with various threats that can put any company out of business when not addressed. Employee skill gaps, product recalls, and cyberattacks on smart machines are some of the expensive costs a manufacturer may encounter. Make sure your organization is prepared to manage any crises that might arise.
II. Types of Business Ventures for the Manufacturing Industry
Manufacturing is home for many business ventures as it covers multiple sub-sectors that can have their own share of business venture options.
With the effects of the COVID-9 pandemic, the global manufacturing industry is reported to have secured a value of $26.2 billion in the first half of 2020, a 40% deal value and 20% deal volume decline from the previous year.
Companies are aiming to recover from the pandemic by investing in other forms of manufacturing. This is in the hopes of finding their footing and gaining stability amidst unexpected hard-hits such as a global pandemic.
Manufacturers search for organic growth, and M&A help them achieve this. This allows them to gain global reach, expand their audience base, integrate vertical expansions into their supply chain, enhance efficiency, and improve their competitive advantage.
Frontier has a team of professionals with extensive knowledge in helping manufacturers with their M&A strategies. We generate focused improvement initiatives for the business to gain momentum and drive continuous growth progression that’s designed to last for long-term success.
Product Innovation Opportunities in Manufacturing
The manufacturing industry has been criticized for its inefficiencies and inability to keep up with emerging technologies in the past. However, there has been a significant change in recent years. New technologies and innovations that are implemented on plants or factories were driven by smarter machines and the advent arrival of new manufacturing techniques.
In order for a manufacturing business to secure its sustainability and future success, the adoption of new tech should be a no-brainer. Customer-centric businesses understand the value of exceeding customer expectations.
As the market becomes more complex, businesses are constantly looking to up their game and stand out in today’s crowded marketplace. For instance, a chunk of the market is concerned about what goes into a product they’re buying. In order to answer this, a business can be more transparent and include important details in their product labels. This idea is the same with a manufacturing company.
As businesses adapt to these market demands, manufacturers also need to follow. That said, it’s crucial for a manufacturing business to be on the lookout for new technological advances. Frontier has expertise in supporting its industrial clients in navigating this technological evolution, and can assist your organization with lean manufacturing and change management.
III. Common Questions in Manufacturing
Manufacturing businesses need to have a solid foundation of knowledge that will influence their business-making decisions. Here is a list of common questions that Frontier helps its clients answer:
- How do we calculate the overall productivity of a large manufacturing industry?
- What are the technological advances we need to be implementing?
- What is lean manufacturing and how do we implement it?
- Is continuous improvement important in the industrial sector?
- How do we acknowledge niche consumer needs while also generating revenue?
- How will technology enhance or hinder our ability to compete with competitors?
- How can we integrate new networks and systems?
- Is GMP or ISO certification really necessary? How do we prepare?
- What are our M&A execution capability and odds?
- What M&A deals should we focus on?
This industry will have to adapt to various technological, social, and environmental factors. As the world will continue to change, so will the demands of the market.
IV. Manufacturing Industry Standards
The manufacturing industry follows standards in its management, systems, and policies to become more sustainable and profitable. Here are some of the industry standards in manufacturing:
- Quality Control
- Facility certification – GMP, ISO, FDA or DEA approval, etc.
- Procurement – ingredient sourcing is becoming more important to consumers. Do you trust your source?
- Environmental factors
- Energy management
V. Manufacturing Industry: Frontier Case Study
Frontier with a client during the first two months of the COVID-19 pandemic to shift manufacturing processes from China to Mexico to deliver 20 million units of hand sanitizer to Costco and Walmart for the American consumer. Frontier sent a team to Mexico to manufacturing facilities and partners in seven different Mexican states to ensure quality and speed to market to meet the demand and timeline of our client.
We also conducted a GAP analysis and assessment for a large US-based cosmetics manufacturer to optimize its SPLC process with its bespoke systems and software. After recommending our client focus its attention to potential FDA major-issue areas, Frontier was engaged to prepare the client for GMP and ISO audits and certification.