Industry Highlight: Job Shop

A job shop is a manufacturing process in which companies produce small batches of custom or semi-custom made products for their customers. They come in all shapes and sizes and use a variety of different materials. Most of the products produced in a job shop environment require a unique set-up and the right sequence of processing steps. Commonly known as “make to order”, job shops do very little repeat work and, in some cases, rarely produce the same item more than once.

What Does a Job Shop Look Like?
In a job shop, similar equipment or functions are grouped together. This layout is designed to minimize cost, material handling and work in process inventories. Instead of relying on specialty, product-specific equipment, job shops use general purpose equipment to produce their orders. This type of equipment gives job shops the flexibility to change set-ups on a variety of machines quickly and efficiently. Employees are often highly skilled in the shop’s specific craft and are qualified to operate on several different classes of machinery.

When an order arrives, it travels throughout the various areas of the shop according to the shop’s sequence of operations required for that specific order. While every order does not pass through every machine, jobs may return to the same machine for processing several times.

Once the customer has been quoted, a job sheet and blueprint are created before the job is released to the production floor. Once on the floor, employees complete job sheets and time cards for labor cost calculations and update records for quoting future jobs.

While it is generally easy to make an estimate on jobs the shop has manufactured before, new jobs require accurate cost estimates of labor, materials and equipment as well as the accurate assigning of overhead to the job. Tickets follow each job throughout the shop process, and time and activities are recorded as they pass through each phase. Because job shops produce specialty, custom items, they compete on quality and customer service rather than on price. The raw materials inventory is limited, as customers generally bring in the parts and materials to be worked on. The job shop has work-in-process inventory while jobs are being completed, but generally the customer is waiting on the order and expects prompt delivery, so there is no finished goods inventory in this make-to-order environment.

Many small to mid-sized manufacturing companies begin as job shops, taking advantage of the flexibility to make products that meet customer quality demands and service standards. Job shops face many challenges (such as dealing with constant change, hitting upcoming customer due dates, scheduling the shop floor and accurately tracking job cost) and in order to deal with those challenges, companies should invest in the proper software.

Contact us today and let us help you properly manage your job shop environment.

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