Many businesses are transitioning to outsourced manufacturing to improve efficiency and profitability. Outsourcing helps businesses avoid the costs associated with equipment ownership and specialized labor. Lean businesses can gain advantages by choosing a full-service manufacturing partner. The right partner serves as a one-stop-shopping provider.
Buyers with a single source for materials and services benefit by spending less time qualifying and coordinating vendors. In the case of highly technical products, choosing a supplier with an experienced engineering team is particularly advantageous. The right partner also provides savings on materials due to volume purchasing.
Some purchasing managers might object to a single-source supplier. Price concerns may arise from a lack of competition. Actually, the reverse can be true if the right supplier relationship is established. The full-service supplier benefits from dependable work flow. The buyer increases their leverage as they increase the total volume of business they outsource. This should be kept in mind as contracts are negotiated.
Above all, relying on a single-source supplier can be risky if the right supplier is not enlisted. It is essential that businesses thoroughly vet the supplier before signing a contract. Areas to look at include:
- Industry experience
- Level of technical expertise
- Manufacturing capabilities
- Financial stability
- Availability for technical assistance
- Shipping logistics
- Supply chain approach
- Investment in workforce development
- Investment in new technology
- Delivered cost
Looking for a one-stop-shopping manufacturing partner that will supply products and enhance the profitability of your overall operations? Contact us to discuss your needs.
