In sports, keeping score is the standard way of measuring success.

Fans have always had incredibly heated debates regarding which team is better. (Not that I have ever participated in that). The only way to know for sure which team is better is when they play each other.

One wins. Another loses. All based on keeping score.

Can you imagine the forehead vein-popping drama that would ensue if keeping score was eliminated from sports? What if we went with gut-feelings instead? Or only based the outcome of how they matched up on paper or an injury list? Or who had the best-looking logo?

I can guarantee you it wouldn’t be pretty.

So in your shop are you operating it without keeping score on the things that matter most?

Keeping score allows you to measure your success.

It works that way in sports for a reason. The same goes for your shop.

Here are a few ways you can keep score in your shop to help you run it better:

Keeping Score 1 – Breakeven Point

Simply put, a Breakeven Point is the amount you need for your sales to actually cover your expenses. Do you know this for what you should be selling per week?

Although it should be part of every basic business plan, for many shops this actually is never calculated.

Why is this important?

For starters, it helps you determine if you are exerting enough effort on your sales pipeline. When sales start to drop, or even worse, go below your Breakeven Point, trouble is looming.

Having a score that you can refer to allows you to make better decisions.

How to Calculate Your Shop’s Breakeven Point

There are three variables you’ll need to consider. Since you aren’t manufacturing widgets, use averages of these for each one listed.

  • Fixed Costs – these are the costs that are constant, such as your overhead.
  • Variable Costs – these are the costs that fluctuate and are usually tied to production. This is what it costs you to make your product.
  • Selling Price – what you are selling your product for in the market.

In order to calculate your shop’s Breakeven Point use the following formula:

Fixed Costs à· (Average Sales – Average Variable Costs) = Breakeven Point in Units

Let’s test this with an example for Shop XYZ, our fictional business we built the 5 Buckets Shop Costs webinar and blog article around.

For the example today, $20,995 is the total yearly overhead costs for Shop XYZ for 2017.  $9.23 is the average price of shirts sold. Variable costs are the sum of $2.00 for the average t-shirt blank cost and $0.65 for the yearly decoration average cost.

Fixed Costs Total $20,995 / (Average Sales $9.23 per shirt – Average Variable Costs $2.65) = 3,190. Divide that by 52, and if the average sales price per shirt is $9.23, Shop XYZ will need to sell 61 shirts a week to break even.

Homework: Enter Your Numbers

Your answers will be completely different than these. How many shirts a week do you need to sell? Is this number more or less than you thought before you did the math?

Remember, the Breakeven Point is not about profit. It’s about staying afloat.

Most shops lose money in Q1 every year. As you know, Q2 is when orders pick up. If you understand your breakeven amount and instead of losing money in Q1, your shop reached the break-even goal with costs, then you’ll be on the path to profitability earlier in the year.

Having this number in your head can help you focus on what you need to do.

Keeping Score 2: Production Numbers

How connected are the expectations your sales team drops onto the reality that can be produced in production? Do sales ever over-book production to the point that they can’t keep up?

Yeah, I know…it’s a good problem to have.

But what if increasing efficiency and making better decisions solved that production backlog problem. Would you be interested in that?

Think how much more money could drop to the bottom line if your shop produced the work without overtime or other increased costs!

The standard method of tracking this is in three areas:

  • Set-Up Time
  • Production Time
  • Downtime

Why are these important to know?

Measuring these helps you refine what actually can be produced on any given day. Peter Drucker’s famous quote, “You can’t manage what you don’t measure” directly applies to this challenge. Gathering this data is important. Doing something with it elevates you to another level of professionalism.

Let’s take a look:

Set-Up Time

This is the time it takes to get the job ready to go. Let’s just talk about screen-printing for a moment.

Most shops “think” that they set up around five minutes per screen. Therefore a three-color full front print should take about 15 minutes to set-up. But when they actually measure that time, what I’ve found is that they are closer to 8 minutes per screen.

Ok, that’s a 3-minute difference. Big deal.

But wait. That’s 3 minutes per screen.

For that three-color full front that adds nine minutes to the total time. Let’s say that the same press crew averages ten jobs a day in production. The total extra time they used is ninety minutes.

  • That’s seven and half hours per week.
  • Or 390 hours per year.
  • Divide that by 8 hours per day and saving that 3-minute per screen set-up time differential just added 48 days of production to your shop for the year.

How dramatic of an impact on your bottom line would that make?

Homework: Measure Yours

Set-up time is measured from the moment the crew starts working on it until it is ready to rock and roll. If you still have to wait fifteen minutes for a manager or artist to approve the job you HAVE TO include that time as well. This is a team effort for your company.

The goal is to get up and printing faster. Make that money!

Production Time

This is the amount of time it takes to run the job. From the first shirt to the last. How long did that take?

Why is this important?

First, it helps you understand how long certain types of jobs take. Printing on a hoodie, tank top, t-shirt, or 2-ply jacket all take a different amount of production time. Even with the same crew.

In your shop, does your sales team know the average Impressions Per Hour velocity for each of these? The biggest misunderstanding that most sales teams in this industry have is how long things should take.

Printing a thousand hoodies will take longer than a thousand t-shirts. Does everyone in your shop understand this?

Secondly, do you want a more accurate production schedule?

Put some thought and effort into measuring your production time and linking that back to your sales or customer service team. Get predictable and fair expectations and use those to create a production schedule that reflects your shop’s reality.

This is as simple as measuring and creating averages for the different work you do.

Then your staff uses those averages for planning and thinking.  Don’t just dogpile on top of a crowded schedule with your fingers crossed that production can pull off miracles.  Make better decisions at order entry to determine the production work schedule weeks out.

Homework: Create Standard Production Time Averages for Different Apparel Types or Decoration Locations

For example, how long should a left chest print take on an auto? What about a full-size location? If you know your average order size (72 pieces? 144 pieces? 1000 pieces?) use that as the guide so it can help with the majority of your orders.

Make an easy to understand chart so everyone will know what to do and make good decisions.

Downtime

Anytime you are decorating a shirt you are adding value to it. This means you are making money.

Cha-ching!

The other end of the stick means that any time you are not decorating is non-value added time and the money train stops.

How many times a day does your press stop during a run? This could be to fix a pinhole, add more shirts to a cart, or clean a screen that is getting a lot of dot gain.

Are you tracking that?

Here’s a quick experiment for you. Go out to your production floor and observe. Keep track of how many times your presses are not printing shirts. You will be surprised.

That knowledge will quickly make you want to track how many production minutes you are losing a day.

Once you start tracking, dive in and find out why there are challenges.  What’s the most frequent problem?

For example, instead of ignoring that your printers are taping up screen pinholes constantly, dig in and investigate best practices for your screen room. Maybe switching emulsion or simply cleaning the vacuum table glass resolves the challenge.

The goal: Print more shirts per day by not stopping.

Homework: You Guessed It. Track This Stuff

Don’t ignore those numbers. Find out what they mean!

Keeping Score 3: The Theory of Constraints

This is all about your bottlenecks. Every shop has them.

The term Theory of Constraints comes from the famous book, “The Goal” by Eliyahu M. Goldratt. (I highly recommend it!) A constraint is the important limiting factor that prevents a goal from becoming a success.

It is the weakest link in your production workflow chain. Remember, you can only move as fast as the slowest part of your process.

In your shop, can you define that? Would other stakeholders in your process agree on what is the slowest?

Something is getting in the way. Your job is to find out what that may be. Then, determine what will be a good number that defines success?

For example, for Shop XYZ they routinely use around 100 screens a day printing orders. The problem is that the reclaim team only manages to clean around 45. They routinely run out of 110 and 156 screens for underbases too.

It doesn’t take long until the production team is screaming for screens that aren’t available on the rack.

“Hey, we have jobs to print!”

That’s when the big drama ensues with finger pointing.

Solve By Making A Change

Shop XYZ establishes that the reclaim team needs to clean at least 95 screens per day to keep up. At least 10 of these each need to be 110 or 156 mesh. That’s their score they need to manage to keep screen-print production on track.  They should reclaim more, but 95 is the bare minimum for the day.

To handle this they simply hung a clipboard with a legal pad on the wall. The staff in reclaim writes in how many they achieve per day in total, and also with the two mesh counts they are tracking.

Then, as the goal is to keep production stocked with screens ready to use. If they can’t hit their number, the team regroups to consider solution choices.  Adding more people to the process? Staying late or coming in early? Maybe a few hours on a Saturday?

Proactively solving challenges is a good thing.  Don’t let one department’s challenges influence the productivity of another.

Homework: What is the Weakest Link in Your Shop?

No blaming! Simply jot down the best opportunity for change. What would others in your shop say?

Once you have that, can you assign a number to it that you can track?

Keeping Score Totals: Every New Day Is Zero

If there’s one thing I’ve learned in this crazy business is no matter what you do, there will be challenges along the way.

You may have had fantastic results today. That surely beat yesterday’s pitiful totals. Yikes.

When you are keeping score, no matter what you do, every new day starts at zero.

Zero. Zip. Nada. Bupkis. Nothing.

It’s a brand new slate.

So does that depress you or excite you?

I’m always in the excited camp. It’s an opportunity to do better than yesterday. Can we get one more? Maybe two? Ten?

What does that look like? How would we go about achieving that? Can we describe it?

Keep scoring!

.

“If it doesn’t matter who wins or loses, then why do they keep score?” – Vince Lombardi

“The productivity of work is not the responsibility of the worker, but of the manager.” – Peter Drucker

“Good luck is when opportunity meets preparation, while bad luck is when lack of preparation meets reality.” – Eliyahu Goldratt

 

Production Manager Tool

From day one, we’ve been devoted to making InkSoft the most useful tool for printing and customization professionals across the industry. While thousands of users are growing their businesses with InkSoft Stores and the Design Studio, we know we still have a lot of work to do to help print shops run more efficiently.

The next big step is a production management tool. We want to bring InkSoft full circle by providing a powerful way for you to streamline production and communication, ultimately boosting profitability and reducing costly mistakes. Not to mention, solving the challenges outlined in this article.