A few years ago, getting a loan to expand your CNC shop could be an arduous task. Banks and other lenders who were burned when the economy turned ugly were reluctant to fund small businesses. Today, the picture is much different.
A few years ago, getting a loan to expand your CNC shop could be an arduous task. Banks and other lenders who were burned when the economy turned ugly were reluctant to fund small businesses. Today, the picture is much different.
According to the fifth annual study of high-performing CNC machine shops by Gardner Business Media, the differences between the top shops and the rest of the 277 surveyed are striking:
For the third year, Gardner Research conducted an in-depth study of CNC machine shops to better understand the reasons some companies perform better in terms of income, profit and growth. The study focused on 4 keys to success:
In an earlier post (7 Secrets Of Successful CNC Shops) we discussed recent research that, for the most part, looked at how high-performing shops apply technology to achieve their goals. Since producing parts is the core activity of CNC machine shops, focusing on how technology improves productivity and profitability makes perfect sense, as does working with an experienced manufacturing technology resource like Gosiger.
A survey of 358 CNC machine shops conducted by Modern Machine Shop Magazine sought to identify reasons why some shops are more successful than others. These “Top Shops” had gross sales almost 20% higher than average and grew gross sales from 2009 to 2011 by 51.6%, on average, versus 25.1% for the industry as a whole. They typically have fewer employees per dollar of income, and they spend a larger percentage of gross sales on capital equipment.
Gardner Research recently completed an in-depth study of CNC machine shops to better understand what separates high-performance shops – those that excel at income, profit and growth – from average ones. The study found that the characteristics of these higher performing CNC machine shops included gross sales that were 14% higher than other shops, and median net income margin of 12.9% versus 5.9%. Moreover, the average growth rate for high performing CNC machine shops was 51.6% while the other shops averaged only 25.1% growth.