This is the third post in the Hitachi Business Finance Capital Growth Series, where we hope to Inspire the Next round of growth in your business by exploring asset-based lending and marketing for factors in targeted industries.
We encourage you to download our guide, Marketing for Factors: How to Build Your Brand Online, for additional information that will help you reach your target audiences and grow your brand online.
Marketing for Factors: Manufacturing
Manufacturing companies are a fundamental driver of our nation’s economy. Although many were hit hard by the recent recession, the manufacturing sector remains optimistic about future growth and overall profitability, and continues to rely on asset-based lenders for working capital and flexible lines of credit to grow their businesses.
Offering a range of flexible financial solutions and simultaneously keeping a finger on the pulse of the manufacturing industry will help factors effectively market to their clients and expand their reach in manufacturing.
Manufacturing: Industry Fundamentals and Outlook
During the recession, many manufacturers focused on streamlining their businesses and reducing costs in order to stay afloat. Growth was limited, and companies that turned to factors were more likely to need capital to address shortfalls than they were sources of funding for expansion.
Fortunately, since mid-2009, the outlook for manufacturing companies in the United States has improved, and the manufacturing sector is optimistic about growth in 2015. Revenues are expected to increase in the following 15 manufacturing industries:
• Food, Beverage and Tobacco Products
• Furniture and Related Products
• Computer and Electronics Products
• Fabricated Metal Products
• Miscellaneous Manufacturing
• Non-metallic Mineral Products
• Printing and Related Support Activities
• Paper Products
• Chemical Products
• Transportation Equipment
• Textile Mills
• Primary Metals
• Plastics and Rubber Products
• Electrical Equipment
• Appliances and Components
Although they were hit hard by the recession, the U.S. manufacturing sector worked to streamline their business models and stay competitive. However, many manufacturing companies who relied on alternative lenders during the recession are now switching gears. Ready to grow their businesses, entrepreneurs, start-ups and established companies are researching factors online because they need flexible funding and dependable sources capital in order to grow.
The changing business climate is encouraging. Many Michigan manufacturing companies, such as tool-and-die-shops, who were solely focused on becoming leaner and meaner during the recession, are looking for lending solutions to fuel expansion. This is excellent news for the economy and the factors that serve them.
Marketing to Manufacturing Companies
The new environment of optimism and growth in manufacturing presents opportunities for factors that provide capital to fuel their growth. Manufacturers need access to flexible, reliable funding in order to purchase new equipment, hire additional staff, update operating procedures and invest in the overall expansion of their companies.
As discussed in the Hitachi Business Finance Guide, Marketing for Factors: How to Build Your Brand Online, the first step in building your manufacturing client base is assessing the health of your online brand. Individuals looking for a factor will do most of their research online, so how your company presents itself digitally has never been more important.
Your company website must do more than educate potential clients on the benefits of factoring. Although it’s extremely important to provide clear, well-written educational content, your online brand should also speak directly to the needs of manufacturing clients.
When a manufacturer searchers for a factor online, one of the first things they look for are signs of honesty and integrity. If they partner with your firm, will they be able to trust your financial advice?
Building trust online is difficult because initially, you’re not meeting your client face-to-face. But it’s not impossible. A factor that demonstrates a keen understanding of the day-to-day challenges facing manufacturers begins to build a strong foundation of credibility and expertise. Showing you understand your client’s business goes a long way in establishing the trust required to form long-lasting relationships.
Challenges Facing Manufacturers
Manufacturing companies face unique internal and external challenges that can hamper their growth and make day-to-day operations difficult, expensive or simply frustrating.
The following challenges are cited most often by manufacturing managers and executives:
• Rising cost of raw materials
• Global competition
• Transportation costs
• Supply of skilled/qualified labor
• Labor costs
• Rising cost of health insurance
• Costs to update equipment or other operational procedures
• Government regulations
• Tax burdens
• Balancing capacity with supply and demand
• Effectively planning for transitions (leadership, ownership)
• Continuous improvement initiatives (lead time reduction, quality improvement, customer service, flexibility, etc.)
• Customer diversification
• New product development
Factors that provide capital along with industry information designed to help manufacturers succeed demonstrate the highest level of customer service. Using blogs, eBooks, whitepapers and other company materials, factors should speak specifically to industry challenges facing their manufacturing clients. This will help your firm stand out from the competition and build a diversified client base.
When writing content targeted to manufacturing clients, begin by putting yourself in their shoes. What are the biggest challenges they face? Each client is unique, and the manufacturing niche you serve may struggle with streamlining operating procedures, reducing overhead costs or managing their labor force. Find ways to address their specific struggles with well-researched posts on your company website and across all social channels. Brainstorm topics that would effectively reach your target audience, and make a list of potential titles/subject areas (i.e. Best Practices for Lean Manufacturing, Benefits of Going Green, etc.).
Stay Ahead of the Competition
In order to stay ahead of the competition, factoring professionals must have a deep understanding of the internal and external challenges facing their manufacturing clients. Demonstrating an understanding of your client’s needs in terms of lender finance and their unique business challenges will help you market effectively, and position your firm as a trusted thought leader in alternative lending.
About Hitachi Business Finance
Hitachi Business Finance understands the unique needs of factors lending to manufacturers. With a complete line of lending solutions, we offer factors flexible financing solutions that fuel business growth in the industries you serve.
Whether companies are in a growth phase, or simply need support while they reduce costs and establish financial track records, Hitachi Business Finance has customized solutions to fit your needs as a factor.
Hitachi Business Finance provides business cash flow solutions to support a company’s continued growth and success. A division of Hitachi Capital America Corp., we offer commercial and government A/R financing and lines of credit. Based in Rochester, Michigan, with an office in Atlanta, we provide easy and flexible financing to companies of all sizes across the United States. Learn more by visiting www.hitachibusinessfinance.com or calling (248) 658-1100.