CIMtek Supplier Strategy
Needless to say, coming out of the worst recession in our lifetime and in the history of the modern tooling business, Manufacturers are expected to be very cautious. In the Cutting Tool business, it has been a virtual “blood bath”, with manufacturers cutting their direct sales staff by as much as 50% in some cases. Therein lays the dilemma for manufacturers.
As our industry slowly begins its climb back to respectable levels, all of us will be very skeptical. Is the upturn real? Is it sustainable? Or will it be like Wall Street and be a roller coaster ride? The fact is, for manufacturers in our industry, the only way to ensure success is to be profitable. That being said, there are only two ways for a company to reach profitability goals; cut costs or increase sales. In order to increase sales, you must have “feet on the street”. Not just warm bodies, but highly technical, reputable sales representatives that put their best foot forward on your companies behalf in the market. In a traditional market, this would leave you two options:
a) Increase your company’s Direct Sales force – This is very expensive and very risky in the current business climate. Although cost of sales varies from company to company, it traditionally will average in the 15% to 25% range when salaries, benefits, travel costs, and overall expenses are considered. The advantage of increasing your Direct Sales force is a dedicated Sales team. Then come the intangibles, such as recruiting costs to locate people that could even sell your product. Then of course the question of whether or not your new sales staff can sell. It should be a given, but unfortunately in an industry as technical as ours, there is an ever increasing number of young, inexperienced sales people that may not bring you the results your company is seeking.
b) Use traditional Manufacturers’ Reps – This is a much less expensive option, but even riskier yet. Ask any Sales Manager from our industry with any experience with traditional Manufacturers’ Reps and they will tell you that 10-20% of their Reps make up the majority of their sales. The other 80-90% are essentially worthless, bringing no knowledge, limited technical ability, and even less in sales. In many cases, they are paid 10% or more for NOTHING, simply collecting a check. The advantage of Manufacturers’ Reps, they are “variable costs” and not fixed costs. If they sell less, you pay them less.
This is where CIMtek LLC comes in.
We aim to be the “perfect” alternative for your company. With our experienced, knowledgeable, highly technical staff, we put your company and your products in front of the right distributors and the right end users in order to achieve the results you desire. All of this with the same benefit of being a “variable cost” versus a “fixed costs”. No salaries, No benefits, and No expenses, just results!
From a supplier and product standpoint, our goal long term is to build a group of supplier partners that, when combined, will offer complete solutions to all of our customers, distributors, and the machine tool market. By strategically building a product offering with that mindset, we intend to position ourselves to be uniquely qualified to handle all technical application issues concerning cutting tools, work holding, and anything that is required in the day-to-day machining business.
One of the keys to our long-term success will be the careful planning of our product mix. With our market insight, we have begun to build a vendor strategy that allows CIMTEK LLC to offer our base of end users, industrial distributors, and machine tool builders and distributors a “high-end“, technical solution for any of their machining problems..
Our goal is to be a complete supplier, capable of providing products to fit the following areas:
- Turning Products – Inserts, Holders and Boring Bars, Grooving and Cut-Off Tools, Threading Tools and Inserts
- PCD, CBN, and Ceramic Inserts and Tools
- Indexable Milling Cutters, Inserts, and Solid Carbide Endmills
- Indexable, Solid Carbide and HSS Drills
- Taps and both Indexable and Solid Carbide Thread Mills
- Gear Gashing and Gear Machining Solutions
- Solid Carbide and Insertable Reamers
- Rotating Tool Holders and Retention Studs
- Boring Tools
- Special Solid Carbide and Indexable Tools
- Custom Fixturing and Work Holding
As our product line sits today, we are well on our way to achieving this goal, with most application areas already covered by world class suppliers.