Six Key Strategies for Expanding Your Manufacturing Business

The manufacturing sector is a highly competitive one. With increasing demand for Indian goods on both domestic and international levels, manufacturing companies have the potential to capitalize on market opportunities to grow exponentially. This calls for a steady scaling up of operations, as demand grows. However, scaling up calls for careful business planning, as well as access to adequate and continued financing in order to keep up momentum.

Large companies involved in manufacturing can easily access financing through a variety of avenues, like investor fundraising, IPOs, and large-scale borrowing from traditional lenders. However, it’s a much more difficult proposition for small businesses in the manufacturing sector. This is especially true of micro, small, and medium enterprises (MSMEs). Let’s explore what businesses, especially MSMEs, can do to scale up their manufacturing businesses.

6 Steps to Scale Up Your Manufacturing Business

Scaling up requires strategic planning and continued efforts to expand the reach of the business on various levels. Here are a few ways manufacturing businesses can go about scaling up their businesses:

• Effective Strategic Partnership: One way to effectively scale up a manufacturing business without making massive investments is to opt for strategic partnerships. Whether it’s in the form of joint ventures, supplier collaborations, or logistical alliances, these partnerships can provide competitive advantages and drive long-term success. They facilitate smoother operations, removing bottlenecks and sharing costs among stakeholders, ensuring positive outcomes for all.
• Expand Market Reach: Expanding market reach is a surefire way of capitalizing on untapped demand in different markets and scaling up to meet that demand. However, this would involve a substantial amount of investment, which business owners can access in the form of funding for manufacturing companies. These funds can then be invested in doing ground research, leasing premises, investing in distribution systems and marketing campaigns, etc.
• Optimize Supply Chain Management: Manufacturing businesses can optimize supply chain management by implementing advanced technologies for real-time tracking and predictive analytics, streamlining logistics and inventory processes, and establishing collaborations with suppliers to enhance efficiency and reduce costs. Investing in technology like AI can be expensive, and they can fund it through financing for manufacturers.
• Enhance Production Capacity: Enhancing production capacity is the obvious next step in scaling up a manufacturing business. As demand grows, production must be ramped up in tandem, so that market opportunities are not missed. This would involve investing in cutting-edge machinery and quality raw materials in a timely manner, which business owners can fund through loan for manufacturing unit.
• Develop Human Resources: The other half of the equation in enhancing manufacturing capacity is having a skilled and efficient workforce. Manufacturing units are complex and need diligent and highly-skilled workers to operate them. In order to succeed, business owners must invest in hiring and training such workers.
• Invest in R&D and Innovation: Manufacturing is a fast-evolving sector, and to stay ahead of the curve, business-owners must keep innovating and implementing new technologies. To invest in research and development or in the latest technology, manufacturing business owners can choose a manufacturing business loan. This will allow them to meet these expenses without affecting their day-to-day operations or profit margins.

In order to invest in various ways to scale up a manufacturing business, the business owner must have the financing and resources. All expansion-related activities require a degree of funding to set in motion, and some, like scaling up production capacity can be particularly expensive. This is because the manufacturing sector calls for expensive machinery and high-quality raw materials, as well as a skilled labour force, in order to deliver marketable products. This can be a challenge for MSMEs, as they have access to limited resources and are often turned away by traditional lenders like banks. In such a scenario, a last-mile lending non-banking financial company (NBFC) can be their best bet.

Why Choose Kinara Capital for Scaling Up Your Manufacturing Business?

Kinara Capital is an RBI-registered fintech that provides collateral-free business loan to support the growth of small businesses in the sector. Kinara is the best choice for MSME seeking manufacturing business loan because the company provides fast and easy access to capital, ensuring that these businesses can get the machinery financing and working capital in a timely manner, without hassles.

Kinara’s small business loan can be availed of through three easy steps by downloading their myKinara App. MSMEs can start their journey towards getting a manufacturing loan by taking a 1-minute eligibility check, followed by an end-to-end digital process. This is followed by fast and unbiased loan desicioning through the company’s proprietary AL/ML-based models. The manufacturing loan is disbursed in just 24-hours!

Conclusion

The manufacturing sector is a competitive one, and to make the most of growing market opportunities, manufacturing businesses need to invest in scaling up. They can achieve this through a number of routes, including expanding their reach, scaling up their production capacity, and investing in new technology and innovations. All of these require substantial funding infusion, and although it might be accessible for large companies, MSMEs have a more difficult time. They might be turned away by traditional lenders, and lack the resources to fund the expenses themselves. In such a scenario, an NBFC is their best bet. NBFCs like Kinara Capital can help manufacturing MSMEs scale exponentially by providing them with easy access to unsecured business loans.

FAQs

1 What initial steps should I take to begin scaling up my manufacturing business?
The initial steps you can take to start scaling up your manufacturing business would be to carefully lay out the expansion plan and source the financing you would need to execute it.

2. How can I determine if my manufacturing business is ready to scale?
Demand growth is a good indicator of a business being ready to scale up. If your manufacturing business is receiving more orders than before, or larger ones, that you can’t service because you don’t have the production capacity for it, it’s time to scale.

3. How do I secure funding to scale up my manufacturing operations?
The best way to secure funding to scale up if you own a manufacturing MSME is to approach a last-mile lending NBFC like Kinara Capital and apply for a loan.

4. How can I sustain growth after scaling up?
Sustaining growth calls for continued diligence in planning and execution. It will also require periodic investments as your business continues to grow.

5. How can I ensure quality as my manufacturing business scales?
Invest in high-quality raw materials and the latest machinery, as well as in training your workers to ensure quality while you scale up.

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