ur customers care deeply about speed. In 2018, we launched with a standard lead time of seven business days, which put us at about half the lead of our regional competitors. We quickly dropped that to five days standard. As we grew, we realized that we had systems that would enable turnarounds as fast as same day: order before noon, have parts in-hand tomorrow. We delivered completed parts faster than many shops might quote them. We charged a lot more for that kind of speed. For several years, those rush fees accounted for literally half of our net income.
That tells a compelling story about how much our customers value speed. But in late 2024, we changed our model: We reduced our standard lead time from five days to just two for simple parts. Same-day shipping is still available for a premium, but fewer customers choose it, because the standard lead time is so short. The number of customers paying for extra speed instantly dropped by a whopping 75%.
That was a painful change, but something magical happened when we made the switch. Our pace of growth more than doubled overnight. We started acquiring new customers faster, and existing customers started ordering more often. It’s hard to prove causality, because we’ve been improving our service in other ways as well. But the drop in rush revenue perfectly aligns with our accelerated default lead time.
The real miracle is that despite losing 75% of our rush revenue, our overall revenue growth accelerated by 100%, and our net income and margin in 2025 was higher than ever before. Not everyone is willing to pay extra for speed. But when speed is the default, people are significantly more likely to buy.
We also learned that speed is hard. Fast turnaround requires excess capacity, and in a capex-heavy, labor-heavy business, that has a real cost. It also requires more working capital. If you want to promise same-day or even next-day shipping, you have to keep the inventory in stock.
Altogether, a business structured for speed will have higher capital requirements to support growth. Meanwhile, you have to walk a narrow line that balances growth, capacity, and price. Grow too fast, and you suddenly can’t promise fast turnaround anymore. That’s a problem if speed is your big differentiator. On the other hand, if you add capacity too fast, you lose capital efficiency or, worse, profitability. The bigger your company is, the easier this balancing act becomes.
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Read the full article at The Fabricator
