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Finding Your Niche as a Subcontract Engineering Business

Sarah Venning

It’s a well-known fact that having a unique selling point (USP) is a must if you want your business to flourish against a backdrop of competitors with similar services. As well as assigning a renewed sense of direction to your business objectives, having a USP can position your company as an industry expert within your chosen field, allowing you to tap into previously unchartered markets with confidence.

As a subcontract engineering company, your potential USPs are certainly vast and you can choose from a multitude of different possibilities when it comes to refining your business’s offerings. Here are four to consider:

1.      Batch Size

For companies that offer processes such as laser cutting, presswork, moulding and casting, it goes without saying that larger batch sizes are almost always going to be preferable. Indeed, this is often the case for the buyer as well, especially when the costs of associated tooling are factored into account. However, for machining and general fabrication suppliers, there is often a lot more flexibility when it comes to the scale of production.

Where you choose to focus your efforts is going to depend largely on your in-house setup. If you have machines that allow for larger production runs extending into the tens of thousands, then this is something you should be promoting to your clients. Why? Because batch sizes of that magnitude are not something which every machine shop can accommodate.

On the opposite end of the spectrum, some machining outfits have multi axis machines that are able to produce complex parts. Many such businesses choose to focus on one-offs and lower batches, offering the manufacture of prototypes and other small-scale production runs which may not be best suited to other suppliers.

2.      Industry

Many industries require accreditations from their suppliers which are often specific to their field. Acquiring and maintaining these certifications usually involves a certain amount of investment – both in terms of time and money. This means that OEMs can sometimes struggle to identify suppliers with the necessary approvals they require.

By gaining a certification, you become a go-to source for the industry which it applies to. Although you might not see instant results in terms of increased orders, it will certainly open doors for you when you proactively approach well-aligned buyers. Never underestimate the power of a good reputation and once you have a few clients from a specific sector within your portfolio, the resulting snowball effect can yield many more.

3.      Materials

By building up experience working with exotic materials, some subcontract engineering companies have found a niche that sets them apart from their competitors. Mistakes can prove expensive when dealing with harder metals – as can the associated tooling. Subsequently, many suppliers limit the materials they will work in to eliminate the possibility of costly errors. This is completely understandable; however, the work can be extremely lucrative for those with the necessary experience and right equipment.

Alternatively, there are subcontract engineering businesses have taken the decision to avoid cross contamination and work purely with one specific material. Although this does drastically limit the projects you can undertake, some suppliers have used this to craft their reputation as a specialist, meaning that their clients know exactly where to go when they have a requirement that fits the bill.

4.      Component size

When it comes to parts that are either extremely large or small, many manufacturing buyers struggle to source suppliers that have suitable facilities. For instance, machined shafts that exceed a metre either in length or diameter, or large-scale fabricated assemblies, are usually awarded to companies that specialise in such work. These are not run-of-the-mill projects which are suitable for just about any supplier. Therefore, if you’re looking to diversify into a specific niche, it may be worth considering investment in machines that can accommodate larger components.

On the flipside, small machined parts - often ordered in large quantities - are sometimes equally as hard to source. Companies with machines that allow for large-scale production of small components are therefore able to tap into the opposite end of the market.

Do you have any suggestions on how subcontract engineering businesses can find their niche? Leave us a comment below

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About Sarah Venning

Sarah is a sales & marketing content writer, with five years of experience within the engineering industry.  Working both at Qimtek and on a freelance basis, she can usually be found hammering away at a keyboard or with her head in a pile of engineering drawings. When she's not writing, Sarah enjoys music, reading, red wine and losing play-fights to her kitten, Hobbs.

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