Is Batch Manufacturing Right For You?

Batch manufacturing isn’t a new concept. But startup culture and the interconnectedness of the global marketplace require business owners to consider every possible technique and cost-cutting measure. As a result, for many types of operations, small batch manufacturing is a welcome alternative to “traditional” mass production. So what is it?

Essentially, batch manufacturing is where all of the raw materials required to make a product move through the assembly or fabrication process together. If your business involves making 10 bars of soap or 10 pairs of jeans at a time, your “assembly line” will see 10 bars’ or 10 pairs’ worth of materials proceed through each manufacturing step together. That means there’s a pause in between each step. The batch doesn’t proceed until each of the 10 units has been processed at that stage of assembly.

What Are the Advantages?

Batch manufacturing isn’t for everybody, but it does deliver noticeable benefits for the right kind of operation:

Reduced time required for setup: One-piece-flow requires frequent machine and tool changeouts. Instead, batch production deals with larger quantities of workpieces at the same step. For example, if your setup time for sewing a zipper into a pair of jeans is 30 minutes, and the process takes 10 minutes per pair, sewing zippers for a 10-pair batch of jeans wastes far less time during setup than sewing zippers into 10 separate pairs of jeans, with machine setup performed in between.

Product flow: When employees can perform the same process on a whole batch of products before moving on to the next step, it means they’re spending less time moving materials around and more time invested in the detailed work that gives your products their characteristic handmade feel.

Quality control: Assembling or manufacturing products in batches makes it easier to spot and reject defects, compared with performing one step at a time, which might hide an error from a previous step of the process.

Greater opportunity for customization: Owing to the pauses between steps, batch manufacturing means companies have opportunities to alter or customize small runs of products. In a traditional assembly line, customization may require a total retooling of the workflow, since each step of the process takes place concurrently as the stream of products flows through.

The chief benefit of mass production over batch manufacturing is that it’s easier to scale. However, as we’ll discuss in a moment, the ability to manufacture smaller runs of products cost-effectively makes processing in batches uniquely attractive for startups, small businesses, individual artisans and even, under the right circumstances, major corporations.

Are There Any Downsides to Batch Manufacturing?

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As mentioned, batch manufacturing has a pause between each step of the assembly process. This can be an advantage for reasons already discussed, but it may also magnify your labor costs. This pause doesn’t just halt production briefly — it also requires the application of labor and time to usher the as-yet-unfinished products from one set of machines to the next.

If physical space comes at a premium for your business, it’s also important to note that batch manufacturing can leave some machines idle for longer than you’d like. When products move from one stage to the next, the machines used in the previous stage may not make you any money, unless there’s another batch following very closely behind.

Adopting batch manufacturing may also make it difficult to pivot to a different type of product if and when you need to. Reconfiguring the equipment to focus on a different type of assembly may leave you with an unacceptable amount of downtime — and downtime is one of the biggest enemies of lean manufacturing.

Finally, there’s a good chance that product inspection can take longer with a batch manufacturing system than with one-piece flow. Whether a batch consists of 10 workpieces or 100, the whole batch must be inspected and appraised for quality all at once before the next batch can begin. It also means that if a defect is detected, a whole batch of products might be lost before a machine fault becomes apparent.

Batch Manufacturing for Companies Large and Small

Batch manufacturing may well be the wave of the future. Think about how quickly the costs of logistics and overseas labor are rising, not to mention how much faster-paced the economy is today. Then, there’s the ever-higher demand for localized and customized products. We can reasonably expect that manufacturing in smaller batches, closer to the end user, is an inevitability rather than a possibility.

Batch manufacturing can be appealing even for multicontinental corporations such as Under Armour and Adidas. In Adidas’ case, batch manufacturing allows the domestic manufacturing of a custom family of products specifically designed with citizens of New York City in mind.

With batch-based manufacturing, smaller business entities and artisans can scale their operations to meet demand without relying on mass production. Simultaneously, major companies can scale down some of their operations to better serve a specific geographical area with specific needs. For these large companies, it means emulating smaller-scale manufacturers, one product or product family at a time, while maintaining the clout and worldwide resources of a major brand.

Per official U.S. Consumer Product Safety Commission guidelines, a “small batch manufacturer” is one that satisfies these two requirements:

  • Earns $1,151,088 or less in gross revenue per calendar year.
  • Manufactures 7,500 units or fewer per calendar year.

Batch manufacturing appeals to smaller companies and those with less startup capital, as just one production line can yield multiple product types. As discussed, this kind of changeover between products requires time and recalibration. But it means companies without the resources to operate multiple production lines at once can still diversify their portfolio when they need to, and without investing in additional equipment.

Manufacturing in batches may appeal to a number of companies with specialized needs, too — such as those that produce seasonal products or other items for which there is highly variable demand.

Brewing beer is one of the oldest examples of batch manufacturing, but many companies today find it works to their advantage, including manufacturers of baked goods, footwear, apparel, pharmaceutical products, paints, inks, and adhesives.

How to Tell If Batch Manufacturing Is Right for You

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If you’re wondering whether your startup, small business or your garage-based Etsy operation is a good fit for batch manufacturing, it’s worth asking:

  • Can you keep up with demand if you produce all of your items in-house? How many scarves can you knit? How many bars of soap can you saponify? Does it make more sense to outsource to a local batch manufacturer? Investing in all of the equipment required, not to mention the personnel, could make it difficult to become cost-competitive.
  • Do the minimum order requirements of mass production leave you with boxes full of unsold merchandise? Batch manufacturing helps some companies lower their overhead.
  • Does your startup rely on crowdfunding? If so, do you need to find a manufacturer who can help you test an unproven product (or product variant) in small batches, with the ability to make changes as needed, between batches?
  • Does your company stake its reputation on handmade quality and attention-to-detail? Whether performed in-house or contracted out to another party, batch manufacturing allows handmade products to be crafted on a larger scale — just not as large as with mass production.

Engaging in mass production is also, a lot of the time, a faceless endeavor. More and more consumers want to know who’s making their product, from which materials and where in the world it’s happening. Sending materials or unfinished products overseas, and receiving finished goods in return, is a process that’s many steps long. Between 2010 and 2016, 338,000 manufacturing jobs reshored according to reports by the Reshoring Initiative.

Moreover, some authoritative voices, including Jan Van Mieghem of Northwestern University, have come to believe that the time spent waiting for these materials to arrive costs our businesses — in flexibility, agility, and time-to-market — more than we save in labor costs by offshoring labor and manufacturing partners in the first place.

In other words, domestic batch manufacturing can make it easier for companies to respond to the ebbs and flows of demand. It makes manufacturers flexible to the market. Plus, it’s easy for consumers to become dubious about the number of hands on their products. It would be difficult to pass off as “handmade” a product made in batches of tens of thousands in an overseas factory.

Batch manufacturing is an answer to the changing economics of our times. It’s a way to use time and resources more effectively while putting together small runs of products, and it helps maintain quality standards, even as product customization and localization become essential services if businesses want to compete.