Latest Data Reveals how High-Performing CNC Shops Get that Way
September 4, 2015
According to the fifth annual study of high-performing CNC machine shops by Gardner Business Media, the differences between the top shops and the rest of the 277 surveyed are striking:
17.5% business growth rate for top shops vs. 7% for all others
13.5% profit margins vs. 8%
Sales per CNC machine: $277,000 vs. $123,864
Median spindle utilization is 75% for top shops vs. 65%
The makeup of participants in the 2015 study is consistent with previous years: 46% are independent job shops performing short run and non-repeating work; 38% are shops that have contracts for repeating work; and 16% are captive shops of larger manufacturers.
So why, precisely, do these top performers achieve such better results? The study’s key findings make it clear that, along with investing in quality manufacturing equipment, the higher performing shops embrace the concept of continuous improvement and keep their employees engaged in the process.
Among those key findings:
54% of top shops use turn-mill multitasking machines vs. 27% for other shops.
62% of leading shops employ continuous improvement vs. 46% of others.
The use of industrial robots in higher performing shops increased from 10.8% in 2010 to 24.5% in 2014
Although there is little difference in base pay between top shops and all others, 71% of top shops have bonus plans vs. 30% of other shops; 75% of the higher performing shops provide paid medical benefits vs. 43%; and 90% of the more successful shops have annual performance reviews and pay raise programs vs. 48%.
The study documents a number of shop floor practices more frequently used by top shops including advanced software, quick-change workholding devices, high- pressure coolant and one-and-done processes.