How to deal with rising raw material prices

- Feb 22, 2019-

How to deal with rising raw material prices

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Since the beginning of this year, the increase in raw material prices and various expenses has become a common topic in the packaging machinery manufacturing industry. With the further implementation of the Labor Law and other laws, the reform of the employment system, the rising labor costs, and the appreciation of the renminbi, the monetary tightening, Affecting the increasing economic factors of enterprises, this is aggravating the packaging machinery manufacturing enterprises and paper products enterprises with low profits. Enterprises face many difficulties and need to be solved. Multiple pressures have made corporate profits thinner and thinner, and how should companies go? The author conducted an investigation around this issue.

      

1. Enterprises are not adapted to the changes in the situation, and the main contradictions and problems exist.

      

Enterprise managers should clearly understand, accurately grasp the problems and deficiencies in the work, maintain a clear mind, and clarify the direction of efforts. At present, the main problems and outstanding contradictions of packaging machinery manufacturing enterprises: First, there are three unsuitable for some enterprises. That is: the ideological concept is not compatible with the development of the situation; the status quo of the talent team and the development of the enterprise are not compatible with the urgent needs of the people; the understanding and use of the people are not compatible with the laws of the market economy. Second, the ability of technological innovation is weak, the progress of process technology is slow, and the development of new products has not fundamentally shaken off the situation of imitation research and tracking. Third, the mode of economic growth is extensive, the profitability of products is low, and the competitiveness is not strong. Economic growth and efficiency improvement are still mainly driven by scale. There is still a certain gap between energy consumption and labor consumption and advanced level. Fourth, market awareness, competition awareness, and awareness of urgency are not strong. The service market, the awareness of serving customers, and the sense of urgency and responsibility for development are not strong. Human resources can't keep up with the demand for high-level and high-speed production. The reason for the shortage of talents in enterprises is that the development speed is too slow. Fifth, extensive management and refined management have not yet been achieved. Sixth, the managers of some enterprises do not rely on scientific management to seek development in the production and management of enterprises. They always have the luck of relying on the policy of the hole to survive for a while.

      

Second, the solution to the contradictions and problems

      

Faced with unfavorable factors, how can enterprises face the reality to meet the challenge? The author believes that the most urgent thing is to change the way of enterprise development. Enterprises should stand on a new starting point to examine and solve the above contradictions and problems, and take the scientific development concept as the guide. Transforming the development concept, strengthening independent innovation, enhancing market awareness, and effectively promoting enterprise development.

      

1. Innovative business philosophy. Business philosophy innovation, including technological innovation, service innovation, corporate culture innovation, leadership style innovation, incentive mode innovation, etc., in line with the development of the times, specifically from the following aspects:

      

The first is technological innovation. Technological factors play an "unpredictable impact" in the survival and development of enterprises. Because science and technology have a very important position in the development of enterprises, efforts to pursue technological innovation is the fundamental way for modern enterprises to seek development.

      

The second is marketing innovation. The establishment and development of marketing concepts is the basis for enterprises to win the market. On the one hand, we use modern information networks to grasp market information at the fastest speed and effectively process information. On the other hand, modern network marketing provides enterprises with a new and effective marketing model, which enables enterprise marketing not only to reduce costs, reduce manpower input, but also to find customers in a larger market, and create more flexible operating space for enterprises.

      

The third is service innovation. In the era of knowledge economy, service as a "software" for product sales has increasingly highlighted its incomparable importance. Traditional pre-sales, sales and after-sales services can no longer meet the increasingly rich and diverse requirements of customers, and will be replaced by a comprehensive service concept. Full-service refers to a service model in which all the services required by the user can be successfully satisfied. It includes providing users with all relevant information about the company's products, and producing products and delivering products according to the user's expectations to maximize user satisfaction.


 

2. Promote refined management. We will comprehensively carry out refined management activities centered on the “five transformations” and promote the improvement of the basic management level of enterprises. specific measure:  

      

The first is to shift from a big plan to a small one. In terms of cost management and control, enterprises have changed from large-scale planning to small-scale accounting, based on capital management standardization, refining cost control management, improving procurement supervision mechanism, and strengthening information construction.

      

The second is the transition from incremental to quality. In the development of the market, the company has changed from incremental to quality, further close the relationship with new and old customers at home and abroad, strive to open up new markets on the basis of consolidating the old market, and win good products with excellent product quality and sincere service. market share.

      

The third is to change from low added value to high-tech content. In product development, it promotes the transition of products from low added value to high technology. In the case of meeting the needs of ordinary users, the development of high-end, high value-added, and special user needs to lead the industry.

      

The fourth is the transition from extensive to fine. In terms of production management, it has gradually changed from extensive to fine, and through improved process and technological innovation, it has promoted efficiency.

      

The fifth is the transition from basic to civilized. In terms of cultural construction, enterprises have changed from basic to civilized, deepened performance appraisal, strengthened democratic management, promoted corporate culture, enhanced employees' centripetal force and cohesiveness, and provided a powerful driving force for the steady and healthy development of enterprises.

      

3. Strengthen independent innovation capabilities and promote new product development. Accelerate the establishment of a technological innovation system that takes enterprises as the mainstay, market-oriented, and combines production, education, and research to promote the transformation of scientific and technological achievements into modern productive forces.

      

4. Promote the management of all staff costs. At the company level, with scientific market price and cost analysis, formulate practical cost reduction targets, and decompose indicators according to cost structure and departmental functions; at the departmental level, organize all staff to brainstorm and formulate corresponding effective measures and Plan, implement the responsible person; set up the promotion department of the cost management target, and supervise and inspect the whole process with the feasibility review and assessment plan.

      

5. Establish a good corporate image with integrity. The market economy is a legal economy, a moral economy, and a credit economy. Corporate credit is not good and will be eliminated in the ruthless market competition. Enterprises engaged in marketing activities, sales are not only products, but more importantly the company itself. The easiest and most practical way is to be honest in marketing activities.

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