Fabrication and assembly service providers are in great demand, particularly in metropolitan areas. The number of fabrication businesses is growing every year and new fabrication businesses are opening their doors constantly, so as you can imagine – competition is fierce!
The reason for such growth is that fabrication services are a hot commodity for resale and subcontracting. Fabrication shops are now being subcontracted and their services are frequently bought by larger companies. These large fabrication companies or agents then resell the final fabrication product to clients. The clients are usually large enterprise businesses that require these services for their growth and day-to-day operations.
Large fabrication companies purchase from smaller ones and then sell the fabrication products to their own clients. It is more convenient for enterprise companies to deal with larger fabrication firms because they require a job to be done with the least amount of distraction during fabrication. By cutting out the “middleman”, they dramatically improve the efficiency of the process. Not only does this increase the profit margin but it also improves the quality of fabrication and results in faster lead time.
Higher Profitability
The classic challenges of fabrication operations can be drastically reduced by working with the fabricator directly. The largest benefit to working with the fabricator is that it provides an opportunity for higher profitability. Profitability directly depends on appropriate delegation of resources and management of operations. This is why eliminating the extra in-between steps during the fabrication process can minimize unnecessary fabrication expenses, thereby allowing for cost optimization. Additional fabrication costs can be saved by the businesses who outsource their work to fabrication shops directly. The recovered costs can be as low as 5-10% and as high as 35-40%.
By reducing fabrication costs, a business can utilize the available capital and resources to pursue its other tactical or strategic plans. The capital that is recovered as a result adds up to a substantial amount over many years of working directly with the fabricator. In addition, recovered capital from fabrication savings can be allocated to other areas of need, for instance towards potential costs of equity borrowing. Also, a business that works directly with the fabricator can have higher income tax credits. The middleman fabricators include sales taxes under the project’s general expense, thus the client cannot claim ITC.
AWP Plus offers a comprehensive fabrication process from design to assembly. All projected details will be managed by professional operations managers from the beginning to the very end. The best part is, our project management team will require minimal time investment to complete the project. We provide exceptional, high quality services year after year and ensure that our fabrication clients are satisfied. Our clients have said that they were able to optimize their fabrication cost on average up to 25% when they decided to directly work with us.
Improved Quality Control
Businesses who work directly with fabricators are able to be directly involved in the process. This is a major benefit because they can have control over the quality of the final product which depends on each step of the fabrication process. Smaller fabrication shops, on the other hand, often produce lower quality fabrication due to considerable costs savings. However, cost savings on process, labour and materials will inevitably impact the quality of the final fabrication. Working directly with the fabricator gives businesses more transparency as well as steady quality control.
High quality fabrication results should be a top priority for client businesses. The fabrication products can be used to fuel an ongoing expansion or replace important machinery components. In both cases, lower quality fabrication can result in malfunction and affect the overall credibility of the business. In addition, when working with a middle man, a business can experience unpredictable quality levels related to the fact that different fabrication companies complete each order differently.
AWP Plus focuses on providing only the highest quality fabrication – that is our guarantee. We deploy quality assurance processes throughout our entire fabrication process in order to ensure that our clients receive the best possible result. We maintain the highest quality standards for every single fabrication order. We only use premium tools and qualified skilled labour to ensure that your final fabrication is aligned with the client’s technical requirements.
Less Chances of Stalls and Delays
When a business works with a middleman, the entire fabrication process is often much longer than necessary. Project deadlines are not met and an exact completion date is often not specified with a subcontractor fabrication shop. Subcontractors have their own workload and your project may end up at the bottom of the pile which is the last thing you need. The subcontractor will not understand the urgency of your project because they don’t know your current situation. As a result, when a fabricator is indifferent when it comes to your project timeline, your lead time may be stalled.
The stalling of your project is a significant obstacle that will drain time, funds and lower your organization’s overall effectiveness. Moreover, by subcontracting your projects you will lose direct control over the project. The lack of control will require longer lead times and it will push other potential important projects back, not to mention that strategic projects can cost your organization a fortune.
AWP Plus involves a project manager in every aspect of the fabrication process in order to ensure that your project will be delivered on time. We complete the entire process of fabrication in house and therefore can provide you with an exact completion date. You can rely on us to deliver your project in a timely manner.
Final Thoughts
Whenever you place an order with the fabricator it is important to ask whether the project will be completed by their business or if the project will be outsourced. Eliminating the middleman is a good idea for a business because it can lead to cost savings, improve the quality of final fabrication, and reduce the chances of late delivery. Please contact AWP Plus for more information on how you can improve the fabrication process by working directly with the fabricator.
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