Recently, my company Winn Mfg., a CNC machine shop, had to turn down a project from one of our good customers. It wasn’t because we didn’t have the expertise or capability of machining the parts or that we wouldn’t have made a good profit on the job. It was that the delivery date was too tight.
They needed the parts in less than two weeks and we didn’t have the steel on hand to make the parts and it was going to take too many days to get the steel burnouts in for the job. Subsequently, this wasn’t going to leave us with enough time to machine the parts, especially if there were any glitches from the steel supplier or with the trucking companies who would deliver the steel. Even one day was going to make a difference.
Weighing all the factors to make an informed decision
I hated giving up this job, because it meant that they were going to go somewhere else to get these parts! But I knew that the delivery date was the most important part of this project for my customer. Additionally, If we had taken on this job it would have meant that I would’ve needed to schedule some of my employees to work on Saturday and Sunday to only “maybe” make the delivery date. More than likely we would have missed the delivery date.
I can negotiate the price of a project and I can negotiate the tolerances on a drawing on a project before, during and after the delivery of the parts, but I can’t renegotiate a critical delivery date of a project if it is shipped late.
There is an old rule in the manufacturing business that states:
“There are three characteristics of a buying machined parts for a project. Quality, cost and delivery. Never sacrifice any one of these features for the sake of the other two.”
As a supplier of machined parts it is essential for me to know which of these three characteristics is the most important feature of the job. My customer knew that we would supply them with quality parts at a fair price and he also knew that his delivery date was tight, so he put that out there up front.
When I let them know that we couldn’t meet the delivery date. He wasn’t happy, because he still needed to find someone to make the parts. I gave suggestions on where he should look to acquire the necessary materials. He did, which is good for his company because they made their delivery date.
So, did I miss an opportunity? No, I may not have done this particular project, but with being honest with my customer, It allowed me to maintain my business integrity and them to make an on time delivery. Most importantly, I still have a good relationship with this quality customer.