Introduction: It’s Not Just About Orders
Some people might think that the most feared challenge for cable factories is a lack of orders, but that’s not true. What really keeps cable factory owners up at night are these problems.
1. Broken Capital Chain
Cable belongs to the low-margin high-value products, the cost of raw material copper will account for 70% and above. Once the copper price fluctuations, poor liquidity, the enterprise will fall into the following cycle
“no money to buy raw materials – out of stock – order default – compensation”
What’s worse is that the downstream large customers pay back slowly, long cycle, many are 1 year account period, resulting in manufacturers are forced to advance funds, profit margins are very small.
2. Management Chaos
Production plan head shot: production team leader verbal command, progress all rely on the feeling, delivery of the overnight rush, error-prone
Weak quality consciousness: the first thing to do is to shirk the responsibility instead of solving the problem.
Inventory procurement out of control: backlog and shortage of raw materials coexist, the warehouse sends the wrong goods, replenishment of the number of chaotic, heavy losses.
3. Vicious Competition & Low-Price Traps
Cable industry homogenization is serious, small and medium-sized enterprises in order to grab orders to squeeze profits, and even cut corners, 3.15 evening gala that exposed the phenomenon of China’s non-standard cable industry. Caught in the low-end products at low prices – thin profits – the inability to R & D
4. Raw material prices rollercoaster: cost control is difficult to get to heaven
Copper prices every day a price, the cable plant needs to accurately predict the market. If the price of copper skyrocketed, the signed order may instantly change from profit to loss.
5. The Talent & Technology Dilemma
The shortage of technical talent in the Chinese industry, high staff turnover, and poor training of new employees lead to unstable production processes, with each batch of goods being different, resulting in loss of customer trust.
Conclusion
The cable industry seems to be traditional, but in reality, it has a high degree of difficulty in managing production. How to be at the moment, stand out, which requires the cable plant itself to their more accurate positioning, to win the quality of service integrity.
