Beginning the process of outsourcing your raw materials or finished goods can be very daunting. You have no doubt read both the success stories and the horror stories surrounding the undertaking. Like anything else that you undertake in business, the outcome of your outsourcing program will rest entirely on the preparation and planning that you put into ensuring its success.
Rush into it looking for the “magic bullet” cure to your declining profit margins and it could be disastrous. Carefully investigate and understand the opportunities and pitfalls associated with it and it could unlock the door to your company’s move to the next level of performance excellence. The items below give you some things to think about when it comes to outsourcing no matter who you choose to use to assist you or which model you choose to use to accomplish it.
- Execute a non-disclosure agreement. Whether your requirements involve highly sensitive IP or a common off the shelf part, this protects everyone involved.
- Define your ideal manufacturing partner. Their quality certification, equipment set, corporate culture etc. Most companies make a mistake of focusing on the price, and then try to mold the manufacturer into something they're not
- Establish a target price (a goal so to speak) that would make your case for outsourcing to a low cost region. Be realistic. Materials and equipment are not cheaper overseas. Your savings will typically come from labor intensive actions. Determine what savings, inclusive of freight and tariffs, would be attractive to you.
- Provide the best documentation you can. CAD files are better than drawings. Samples are not essential but are extremely helpful. Things like surface finishing and packaging are all critical, and often overlooked.
The suppliers we work with typically meet the requirements listed below. It is by no means an inclusive list but it's a good starting point in benchmarking potential partners.
- Private companies ( not State run)
- ISO/QS/TS certified
- CAD & Web enabled
- Financially stable
- Impeccable customer references
- Well managed and well run facilities
37 Huali St.,Suite 201, No.2 Zhongshan Rd. Zhongshan, GD PRC 528402
Tel: 0760.8888.9170 | Fax: 0760.8888.9175