Who Is Responsible For Your Profit? By Richard R. Vensel Many compa- r nies, no matterwhat 0 their size, seem to have lost focus on why they are really | in business. They ™ are in business to make a profit. That little word, only six letters, can be a killer unless you get and keep it under control. In our industry more and more shops are saying they just can’t make any money. It’s time to rethink your goals. To do this you need to get every employee involved and take a look at the fol- lowing basics. Even in a one-man shop the same basic steps should be taken. Core Receiving. Check the con- dition of broken and missing parts more carefully. Is the starter locked up? Are there teeth on the drive that are discolored or chipped? You need a good core to rebuild. That’s why you have acore charge. You’re buying the core back. Why pay more than it is worth? Core Handling. Put it in the right place the first time. Every time you handle a core it costs you money. We find that a high part of core breakage is done when you have the core in your shop. Get everyone thinking about ev- erything they touch. Handle it as if it’s worth $20 to $50. Tear Down. This industry was built on salvaging as the basis for making money. We have really slipped here. Now it is often replaced with new in- stead of salvaged for profit. When it is cost effective, do not scrap parts, re- pair them and make a profit. Make this A a hard and fast rule throughout your shop. Breaking a housing can cost $20 plus the wasted labor involved. Cleaning. Possibly test before you proceed with cleaning. You are wast- ing money if you clean a bad or unsalvageable part. Test and Sub Assembly. This is where you can make some real money, but you must be able to catch the weak or leaking parts here and wait to final test. Final test should show you how good the unit is, not start you on a mis- sion of fixing it. Save the parts that did not pass. You will be surprised at how fast they build up. When you get a box or drum full, look into the cost of sal- vaging them. Many companies do this in their slow time of the year. This keeps workers busy, money isn’t spent on parts and a profit can be made. Final Assembly. If everything is done correctly in the previous steps there should be no surprises here. If there are, find the previous mistake and fix It. Final Test. You’ ve wasted your time and money if when a unit gets this far it does not meet your specifications. When you have a line reject, go back to the source in previous steps and fix it. Your test standards may be too low or you may find that you need to add another test to your process. If you want more profit, remem- ber that all of your employees are in charge of your profit. Help your em- ployees set your guidelines and speci- fications and follow them and every last employee will be helping you reach your profit level. Richard Vensel is owner of Vensel Enter- prises, Crystal Lake, IL. JUNE/JULY, 2000 Page 1 of 1