Mastering manufacturing: how to work with contract manufacturers

When you’re prepared to turn your design into a tangible product, teaming up with contract manufacturers, often referred to as Original Equipment Manufacturers (OEMs), can advance your business significantly by tapping into their skills and resources. Yet, achieving a fruitful partnership demands meticulous planning, clear communication and rigorous quality control measures. In this blog, we’ll delve into vital tactics for collaborating with contract manufacturers, ranging from grasping Minimum Order Quantities (MOQs) to implementing quality control procedures and streamlining supply chain management.

Understanding the basics: OEM, ODM, and OBM

First things first, let's decode some industry jargon. When it comes to outsourcing manufacturing, you'll often come across terms like OEM, ODM, and OBM. But what do they actually mean?

OEM (Original Equipment Manufacturer): factories dedicated to manufacturing products according to third party designs. In essence, skilled craftsmen behind the scenes who produce your product.
ODM (Original Design Manufacturer): ODM factories not only produce goods but also present their own designs to the market, allowing you to place your branding on them.
OBM (Original Brand Manufacturer): OBM factories go a step further by not only manufacturing products but also branding and marketing them under their own label.

Finding the right Original Equipment Manufacturer (OEM)

When we are requested to outsource manufacturing for our clients, we prioritize factors such as factory expertise, location (proximity to the target market), production capacity, MOQs, quality standards and ethical practices. Finding the appropriate contract manufacturer is crucial for your project’s success, which is why ManGo Product Design collaborates closely with https://www.productionheroes.nl/ With their extensive network of OEM manufacturers, our clients aren't confined to local options but gain access to contract manufacturers worldwide, offering almost unlimited options for manufacturing techniques and types of products. Because at the end of the day if you wish to manufacturer a microwave nobody does it better than a microwave factory.

Minimum Order Quantities, MOQ’s

MOQs refer to the minimum number of units a contract manufacturer is willing to produce per order. MOQs vary depending on factors such as product complexity, materials and production capacity. When sourcing an OEM manufacturer, we always inquire about their MOQ requirements upfront to ensure they align with your business needs and budget. Our partners at https://www.productionheroes.nl/ have a global network of Original Equipment Manufacturers ready to begin production collaborations with relatively low MOQs. And whom can also scale up with our clients if the volumes increase. Keep in mind that the type of product you're developing greatly influences the MOQ. For OEM manufacturers, it needs to be worthwhile to set up a temporary assembly line for your production run before moving on to the next order. Additionally, component suppliers, particularly in electronics, typically demand orders of at least a few thousand units, which are usually the smallest feasible quantities.

Supply Chain Management

Supply chain management is vital when collaborating with contract manufacturers. Most OEM manufacturers operate on a first-come, first-served basis and don't monitor your sales to ensure you have the next batch of products ready before stock runs out. Therefore, maintaining adequate stock levels and timely ordering of new production batches by yourself is crucial to meet customer demand. The team at Production Heroes can offer guidance on stocking critical components with long delivery times and work closely with Original Equipment Manufacturers to plan production schedules, optimize logistics and replenish your inventory. It's advisable to order new product batches several months in advance, as OEM manufacturers may experience periods of high demand. While assembling a few thousand units by experienced OEMs often takes only a few days, acquiring the materials and components, whether off-the-shelf or custom, often takes a lot more time.

Ownership of production moulds

For most products, making custom molds and tools for series manufacturing is necessary and often expensive. When we work with contract manufacturers, we always make sure that our client contractually owns the molds in which they invest. Such contracts also include who's responsible for maintenance of the molds and repairs if they get damaged. Keeping ownership molds gives our clients more control over where they produce. And it also means they can easily make mold changes if needed for whatever reason. Another aspect of importance is to keep track of shot warranties for molds. Production Heroes excels at this task. They ensure our clients are informed well in advance when a mold is wearing out and when it's time to invest in new ones. Since making new molds takes months, this proactive approach prevents situations where our clients run out of stock and can't produce more products in time at the OEM manufacturer.

Quality control

Ensuring product quality is crucial for the success of any hardware company. When partnering with Original Equipment Manufacturers, you have two options for quality control: either perform inspections on-site yourself or hire third-party inspection agencies. In either scenario, quality control involves establishing protocols, conducting inspections for each production run and overseeing manufacturing processes directly at the OEM manufacturer. If you're unable to conduct these inspections due to distance or lack of expertise, third-party inspection agencies can step in on your behalf. For instance, the https://www.productionheroes.nl/ team comprises trained professionals who conduct inspections, tests and audits to verify product or components quality and compliance with specifications before they are shipped.

Working smoothly with OEM manufacturers

When outsourcing manufacturing to Original Equipment Manufacturers, keep these tips in mind:

Stay flexible and adaptable during tooling and manufacturing. Collaboration helps overcome unexpected challenges efficiently.
Clarify responsibilities between you and the contract manufacturer to ensure accountability and efficiency.
Establish protocols for issue handling, dispute resolution and open communication throughout the partnership.
Regular factory visits are essential for transparency, relation building and quality control. Production Heroes can handle this task if desired.
To mitigate the risk of unauthorized copies by the OEM, consider in-house assembly, delivering molded components yourself or installing crucial product software/firmware in your own facility.

Conclusion

Partnering with contract manufacturers gives hardware companies a strategic edge in efficiently bringing products to market. Understanding MOQs, implementing quality control measures, fostering collaboration, optimizing supply chain management and clarifying responsibilities are all crucial for maximizing the advantages of working with OEM manufacturers, and we're here to assist our clients with all of these aspects. Whether you want ManGo to collaborate with your preferred OEM or tap into Production Heroes' extensive network of Original Equipment Manufacturers, we're dedicated to facilitating your project at every stage.

More information

At Mango Product Design, we specialize in product design and connecting our clients with reliable contract manufacturers to streamline the production process and drive your business growth. Contact us today to learn more about how we can support your design and manufacturing needs. Contact us by phone, our online form or send an e-mail to: