Manufacturing should be just about the lowest risk activity going, right?
Transforming materials into objects should be a very easy thing to carry out according to plan, in theory. In practice, there are lots of hiccups and disasters that can scupper a manufacturer’s best-laid plans. It is important to take out comprehensive insurance in the manufacturing industry. Here are just a few of the reasons why.
Material Inconsistencies Can Cause Huge Disruption
A manufacturing operation is reliant upon the materials you can get ahold of. No matter how well-trained your staff is and no matter how good your production line process is, poor-quality materials can still lead to entire batches being unsatisfactory, worthless or even dangerous.
If, for instance, you are a manufacturer of wire, like Baling Wire Direct, a poor-quality alloy could make your products weak and leave piles of garbage across plant floors around the country when there should be neat cubes! Steel for wire manufacturing needs to have a high carbon content. If you have purchased a batch of alloy that is not as carboniferous as advertised, you’ll need insurance to cover the cost of the weak wire that you cannot sell as advertised. Material inconsistencies can have disastrous consequences for just about any kind of manufacturer. Producing a product, your success will be based on the quality and efficiency of manufacture. Tainted or poor quality materials can scupper both quality and efficiency in equal measure.
Manufacturing Can Be Dangerous
All good manufacturers do as much as they can to keep their staff safe. Strict protocols and the provision of up-to-date safety gear can prevent accidents from happening in the large part, but they can still occur. When they do occur, a manufacturer is liable to pay compensation to affected workers. Having insurance ensures that you’ll not be bankrupted should an accident occur. No company operating heavy machinery or utilizing dangerous chemicals should be without insurance cover.
Freak Accidents Can Wipe Out Stock
Sometimes you just can’t control an accident that endangers your materials or manufactured goods. Certain industries, such as chemical manufacturing, are highly susceptible to mass stock soiling. Chemicals have to be very accurately produced. Any foreign object can taint whole batches. Fire can decimate manufacturing operations that use flammable materials. This manufacturing plant that dealt in cotton, for instance, was completely destroyed after a worker used a lighter to open a bag. Insure in anticipation of these freak accidents.
Cover Yourself in the Event of Machine Breakdown
Machine breakdown is one of the key disruptors that need to be prepared for in the manufacturing industry. In shipbuilding, for instance, they are a major issue that can delay a large project for months.
It is impossible to factor in machine breakdowns fully into a manufacturing plan. Instead, they need to be insured for, so that missing a deadline due to a machine conking out is not the end of your company.
There you have it, just a few reasons why insurance is absolutely vital in the manufacturing sector.