OEMs are always under pressure to reduce costs and streamline manufacturing operations. One of the solutions many companies are turning to is outsourcing, or contract manufacturing as it is often called. Contract manufacturing is when a company outsources part of, or the entire, supply chain to an experienced partner, like Chainlogix.
Outsourcing supply chain operations enables OEMs to tap into the expertise of a partner and offers many benefits including increased flexibility, improved quality, time and cost savings, and simplified purchasing and inventory management. This approach to manufacturing has been around for decades, and many industries rely heavily on outsourcing to remain competitive. Below are 4 easy steps for seamless supply chain outsourcing.
STEP 1 - Assess Supply Chain Health
The first step toward seamless outsourcing is to conduct a health assessment of your current supply chain. The purpose is to better understand your existing process including its strengths and pain points. It is also important to identify “value” during this step as it is nearly impossible to streamline a supply chain if the value points are not clearly understood. During the assessment, companies are encouraged to map-out the flow of product through the entire supply network including procurement, production, assembly, warehousing, packaging, and delivery services, in an effort to identify efficiency opportunities and ensure product flows smoothly through each phase. It is also important to take the time to talk with the various business lines to see what steps are sticking points and what improvements they would like to see.
STEP 2 - Identify Areas of Opportunity
The objective of the second step is to identify areas of opportunity across the supply chain and document key issues. The concept of lean manufacturing has been employed for many years and focuses on streamlining operations to improve value and productivity while minimizing waste. Thus, when identifying areas of opportunity within your supply chain, be on the lookout for areas of potential waste. Once your assessment is complete, make a list of opportunity areas and prioritize the issues you wish to focus on, taking into consideration their value and importance to the business, as well as how easy they will be to resolve.
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STEP 3 - Select Your Outsourcing Partner
The third step towards seamless supply chain outsourcing is to identify the best partner for your specific needs. When choosing a partner, there are several key questions that must be considered in order to choose the right company:
- What is the Manufacturer’s History? companies must do their homework to better understand the background of each outsourcing partner they are evaluating. For example, how long have they been in business, who were their previous clients, and have they won any awards or been recognized within the industry? You want an established partner with a proven history and repeat customers. Additionally, ensure potential partners have ample experience working with a company of your size and in your industry.
- What Solutions are Offered? not all supply chain partners offer the same range of solutions. You need to be clear on the requirements for your application and if a potential partner offers solutions that meet your needs. Most OEMs have unique and specific product specifications and it is important that potential contract manufacturers understand and are able to comply with those specifications. Keep in mind that partners with a variety of offerings are better positioned to provide support as your business grows over time. This is why companies should partner with an experienced manufacturer like, Chainlogix, that offers a broad range of integrated supply chain solutions.
- Is the Quality Program Robust? OEMs need a proven partner that is familiar with the necessary production planning needed to meet all of the regulatory and quality standards. Additionally, OEMs need to ensure a partner is providing them with a reliable and dependable process.
STEP 4 - Work Collaboratively
Once you select a partner and outsource part, or all, of your supply chain, it is time to work collaboratively with your new partner to achieve your desired objectives. After all, you are not simply looking for a contract manufacturer, you are looking for a trusted partner that can help your business grow. Good communication and a spirit of collaboration are necessary for any customer – supplier relationship to thrive. A true outsourcing partner asks for input and listens to customers – offering solutions that ensure both parties are aligned and satisfied.
About Chainlogix
Since first opening its doors in 1988, Chainlogix has been an industry leader in creative, engineered solutions for manufacturers. Our highly experienced supply chain professionals assist in every step of the manufacturing process, from design to production of quality products. Through our strategic partnerships, firm commitment to unsurpassed customer care, worldwide sourcing capabilities and offices in the USA and China, clients achieve a sustainable reduction in their total acquisition costs and build supply chain resiliency.
At Chainlogix, we’ve spent years cultivating relationships with proven suppliers and securing the most competitive prices for our clients. We proudly offer the best custom-tailored solutions in the business, and with exceptional customer care that places a high emphasis on human relationships and human connections.
We serve clients across a broad range of markets including industrial and consumer electronics, industrial machinery, telecommunication, lighting, and construction. Our services encompass all areas of the procurement process such as:
- Product development, design and NPI
- Sourcing
- Production
- Logistics
- Supply and demand planning
Contact our team today at 833-874-6635 to see how we can help with your supply chain management.
