Advanced Technology companies sometimes face the challenge of producing industrial equipment while also maintaining their core competencies. Frequently, these businesses simply do not have the internal capacity to produce equipment themselves, especially when demand increases. By outsourcing the production of equipment to a contract manufacturer, companies can concentrate their resources and efforts on new product development and innovation and trust the equipment manufacturing to a reliable partner.
If your company is struggling to keep up with the demand for high-complexity equipment, whether for internal production or resale, here are some factors to consider:
Specialized Labor and Tools
Equipment builds require skilled personnel and infrastructure. When your resources have reached capacity, a decision must be made regarding whether to increase overhead to accommodate the higher production schedule. For example, will you need to hire welders and assemblers, purchase machine tools or specialized test equipment? It may be more cost-effective to outsource to a contract manufacturing company that already has the necessary equipment, skills, and experience to competently carry out the build.
Speed to Market
Time-to-market may be a significant advantage to consider with contract manufacturers. As mentioned above, they already have the resources and expertise to complete projects quickly and efficiently; creating the potential to get to market faster and capture customer demand.
Quality control is a critical factor when building complex industrial equipment and machinery. Established contract manufacturers have internal quality control systems that ensure all equipment is manufactured, inspected and tested to the highest standards, and can easily incorporate rigorous, industry-specific standards when required.
Outsourcing equipment builds can offer flexibility both in terms of design and schedule. Contract manufacturers work with businesses to optimize the design for manufacturing (DFM) of their equipment and can help with engineering for “next generation” designs. Fluctuation of delivery schedule is something all competent contract manufacturers have experience with and robust procedures to handle with ease.
It may be advantageous to outsource the portions of the product that is consistent while focusing on producing the configurable/variable content internally. Another common strategy is to keep the manufacture of core, proprietary technology content in house while outsourcing the remainder of the product to a contract manufacturer.
Utilizing a contract manufacturer as a “second source” while maintaining production in house can be a very beneficial strategy from a business continuity and flexibility standpoint. This strategy can mitigate ramps and dips in demand.
Outsourcing the production of sophisticated industrial machinery and systems also reduces the risks and potential headaches associated with equipment manufacturing: supply chain issues, obsolescence, delays, design changes, etc.
Keller Technology: your partner to manufacture what’s next
If you’re looking to focus on your core competencies while overcoming your product capacity, it’s time to partner with Keller Technology. As experts in advanced equipment builds, we’ll help you manufacture what’s next. Contact us for a consultation.