Flex Capacity in Manufacturing: What It Is & Why It’s Important
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Are you experiencing a slowdown in demand? If so, now could be the time to start thinking about that next increase in demand.
"The average length of time to re-source a product is six to nine months,” says Jeff Pitzenberger, general manager with Ryerson Advanced Processing. “If you’re expecting an increase in demand over the next year or longer, then you must start putting plans in place now to meet that change,
Planning for future demand is crucial and underscores the importance be able to quickly adapt and respond to shifts in demand, all while ensuring you manage fluctuations without sacrificing supply, quality, or timelines. This is a concept called ‘flex capacity’ and here is what it means for your metal parts moving forward.
Defining Flex Capacity
Flex capacity refers to the strategic ability of a manufacturer to adjust its production capabilities to meet changing demands. This includes having the right partnerships, technology, and processes in place to scale operations up or down efficiently.
“When customers audit us, they’re making sure we can handle any shifts in demand. They’re looking for programs that can ensure they have available parts and materials. That’s the kind of critical support you need to thrive in your industry,” says Pitzenberger.
The Skilled Workforce Meets Flex Capacity
The U.S. labor market is facing unprecedented challenges, particularly in sourcing skilled workers for specialized roles.
According to the U.S. Bureau of Labor Statistics, as of April 2024, there are over 10 million job openings, yet only 5.8 million unemployed workers, underscoring a significant gap in the labor supply. This shortage is especially pronounced in manufacturing and advanced technologies sectors.
The National Association of Manufacturers reports that 77% of manufacturers cite the inability to attract and retain a quality workforce as a top challenge. The demand for skilled labor in areas like CNC machining, welding, and robotics is at an all-time high, with some sectors seeing vacancy rates of up to 25%.
Demand for skilled labor in areas like CNC machining, welding, and robotics is at an all-time high, with some sectors seeing vacancy rates of up to 25%.This tight labor market intensifies the need for flex capacity, particularly for OEMs requiring specialized skills. “In the past, certain customers preferred to keep operations in-house,” explains Pitzenberger. “Now, as capacity becomes more of a concern, customers are willing to work with external partners as long as they meet or exceed expectations.”
"... customers are willing to work with external partners as long as they meet or exceed expectations."
Jeff Pitzenberger, Ryerson Advanced Processing
Overcoming Supply Chain Disruptions
Flex capacity is vital in addressing supply chain disruptions, such as shipping delays and part shortages. Manufacturers need partners who can quickly ramp up production to keep operations running smoothly.
“You have to get creative in urgent situations,” says Pitzenberger. “We’re seeing more demand from companies needing an expedited supply base.”
Flex capacity involves leveraging local shops within the OSP network or bringing manufacturing in-house to streamline operations. “Flex capacity is just that: flexible. We’ve provided custom solutions for parts typically manufactured by a single mill in the U.S. that was experiencing delays. Rather than waiting, the manufacturer tapped us to deliver results.”
Meeting Manufacturing Challenges
The past few years have introduced significant uncertainty in manufacturing supply chains. Companies need reliable solutions to maintain stability and adapt to changing conditions. Flex capacity offers tailored solutions to meet each manufacturer’s specific needs, ensuring operational continuity even in challenging times.
“Customers come to us with pointed questions about supply: ‘How fast can we get it?’ ‘How versatile is your supplier?’ ‘Can you find someone to supply this specific part?’” Pitzenberger notes. “Businesses that previously kept operations entirely in-house now have us manage their entire supply chain.”
Flex capacity provides the custom solutions necessary for maintaining supply chain stability. With a fully digital network, Ryerson Advanced Processing delivers the reliability needed to overcome challenges and ensure smooth operations.
Ready to ‘Flex’ Your Supply Chain?
At Ryerson Advanced Processing, our interconnected network of internal processing capabilities across 100 locations is complemented by an outside service provider (OSP) network of over 500 approved partners. This extensive network creates supply chain flexibility, enabling us to meet diverse customer needs promptly.
“We have a digital tool to catalog all of our OSPs,” explains Mike Nauman, general manager at Ryerson. “This means when a customer needs to find an outside partner, we can provide that capability. We manage access to raw materials and oversee manufacturing processes to deliver high-value parts on time.”
We are fully committed to your growth, speed to market, and improved financial performance. Contact us today to learn more about how we can support your manufacturing needs with flex capacity.
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