How manufacturing has changed over the last 10 years and how to keep up

With the help of MRP software, manufacturers can monitor inventory across the entire facility, resulting in fewer mistakes with costly consequences. This data is used to determine production schedule mixes and drive overall purchasing decisions for parts, tools, or materials needed for production.

It was once the case that if you wanted to manufacture a product, such as a computer chip for an iMac, it would be best to locate your factory as close to the point of sale as possible. While this may still hold true for some industries and products, recent changes in consumer demand have encouraged manufacturers of more "durable" goods - such as cars and smartphones - to plant their flags further afield.


The rise of Asia in the world economy has been well documented, but it is important not to overlook the emerging trend of globalization that is also changing how we produce, market, and distribute our products. This phenomenon is driven by the growing importance of "the consumer" in emerging markets, demanding more choices and brands, with a harder focus on price. Up until 2020, spending power in emerging economies has increased exponentially. And before the pandemic, it was predicted by the World Bank that approximately 1.38 billion people were expected to join the global middle class.

However, this number has been reduced to 1.32 billion, further complicating the landscape for new manufacturers. Nevertheless, the boom in the number of companies that manufacture products is still ongoing, thanks to the rise in e-commerce in developed countries. Consequently, manufacturers have been forced to speed up production cycles and adopt faster - even instant - responses to consumer tastes and preferences. Fortunately, the advent of new business models is making it easier for manufacturers to do so.

An increase in the number of exclusive licensing deals has seen more products being produced by manufacturers who do not even own a factory, and off-the-shelf production techniques mean that small runs of products can be made quickly and efficiently. Not to mention e-commerce platforms that simplify the distribution of goods and allow manufacturers to establish direct-to-consumer (D2C) channels for a low cost.

Globalization has also had a significant impact on retailers who have been compelled to serve an increasingly disparate range of shoppers. No longer confined to offering a few choice products, they now stock more - and different - products than ever before. The result is that retailers have had to step up their supply chains and open new markets around the world where they can sell their products. With the cost of transporting goods growing, they are increasingly looking for closer options, resulting in manufacturers are moving closer to them rather than vice versa. With transport costs continuing to rise, COVID-19 restrictions further complicating supply chain routes, and retailers still feeling the effect of tight margins, it is likely that this trend will continue.

Manufacturers will need to learn how best to adapt to continue to serve the increasing demands of consumers who demand more choice than ever. And one of the ways to do this is to use manufacturing software. Modern technologies have emerged to help manufacturers reduce costs and maintain competitive pricing. Today, most manufacturing companies use MRP software or material requirements planning software to keep an eye on inventory, track progress across the facility, and set up important alerts that notify managers of necessary actions like re-ordering or transferring products.

With the help of MRP software, manufacturers can monitor inventory across the entire facility, resulting in fewer mistakes with costly consequences. This data is used to determine production schedule mixes and drive overall purchasing decisions for parts, tools, or materials needed for production. Production planning has also evolved with innovations in MRP software. Employees can analyze data for information that can help smooth production out, like dependencies between manufacturing steps, common causes of delays, and bottleneck operations.

While technology has lowered the barrier to entry for new manufacturing companies, the combination of global trends and a rise in consumer expectations and competitors have also made staying competitive more challenging.

About Katana

Katana is a business software solution that gives modern manufacturing companies the live overview they need to make decisions. The end-to-end manufacturing ERP platform includes features for inventory control, real-time master planning, and production scheduling while integrating with the software you love to streamline operations. All plans come with a free 14-day trial.

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