Fabtek has the ability to position themselves for profitable growth, but they need to fix their business, focus on key business drivers, and re-evaluate the area. Listed below are the key issues they face and the recommendations for improvement. Focusing on these issues and developing selection criteria for quoting would help Fabtek improve their current profitability and position them for growth. Fabtek should accept the Pierce Pike order as it closely matches Fabtek's selection criteria for selecting orders.
Lack of Sales Focus Fabtek states anyone can make a sell. This indicates the company places a low priority on training sales people. Fabtek needs to focus on direct selling and train sales reps to accomplish market growth and to sell customer value. Cost Structure and Bidding Process Manufacturing Costs are unreliable and the Bidding Process has a low success rate. Fabtek needs to train its manufacturing and marketing group to work together in estimating accurate costs, lead-times and understanding customer value in quoting a job. Too Many Markets Fabtek must evaluate the 11 markets served and identify those in growth segments that are not price sensitive, and value quality. Fabtek should focus efforts on these markets. Lack of Capacity Titanium has been identified as a growth market. Fabtek must either be more selective in order intake or plan for capacity expansion. Refocus on Core Competency Fabtek's core competency lies in welding Titanium with a high degree of quality. The company needs to build on this strength.
ANALYSIS and RECOMMENDATIONS
Lack of Sales Focus
Fabtek believes anyone in the organization can act as a sales rep. This indicates the company places a low priority on having dedicated, trained sales people. The sales function at Fabtek is understaffed and overlooked. An investment in a "fabrication" sales force would allow Fabtek to grow profitably and have direct, consistent...