People who are not familiar with the industry may believe that CNC machining factories can generate significant profits, but as everyone knows, this is a fallacy.

There are many bosses who run machining processing factories who are dissatisfied with their low order profits, especially now that the epidemic has made doing business more difficult. Today, we'll talk about the factors that contribute to the low profits of CNC machining factories, as well as strategies for increasing profits.

1. What are the factors that contribute to the low profit margins of machining factories?

We discovered a very cruel reality as a result of a variety of data. Increasingly transparent pricing for CNC machining has resulted from the low technological content of turning milling planing and grinding as well as the widespread use of the Internet. Furthermore, the CNC machining industry is a labor-intensive industry in which fierce competition exists among competitors in the same field. The profitability of the CNC machining industry is decreasing as a result of rising material costs and environmental protection reforms that are being implemented.

2. What strategies can we use to increase our profits?

According to what has been said thus far, it is only through the elimination of machining factories' reliance on turning, milling, planing, and grinding processing technology, as well as the acquisition of more high-tech processing technologies, that CNC Stainless Steel Machining will be possible to increase profit margins. Despite the fact that turning, milling, planing, and grinding are all necessary steps in the production of automotive parts, the majority of them are completed using riveting, welding, laser cutting, and a combination of tooling that has a certain level of technical content. Turning, milling, and grinding are only a few of the processes involved. You can make a profit of approximately 10% by engaging in this type of processing business.

B. Only innovation has the potential to find a home.

If the previous business philosophy and business model are maintained in the current competitive environment, I believe that the majority of processing factories will be closed by the end of the decade. Having our own production space is essential for increasing the profits of the factory, which can only be accomplished by constantly evolving with the times and constantly innovating in order to achieve higher profits.

C. Have characteristics that are unique to the factory

It is also critical to have the factory's distinguishing characteristics in order to generate profits. Leading processing technology, resource conservation, process streamlining and merging, automatic or semi-automatic processing processes, or the use of small machines to perform large tasks in order to reduce costs, among other things, can all benefit from these considerations. Despite the fact that the benefits of each item are not particularly significant, they add up to a significant sum.

D. Continue to iterate on product upgrades.

Additionally, you may want to look for products that have been processed with minimal effort. You can identify potential development opportunities by understanding the product's processing flow, as well as the existing processing technology and costs. Meanwhile, the product can be upgraded and iterated on at the same time. Furthermore, this is a favorable environment for profit development.

As a conclusion, we can only succeed in the competitive CNC machining market if we are constantly understanding the situation of our competitors, continuously researching the machining market, strengthening our own strength, and identifying business opportunities that our competitors do not have.