The contract manufacturing industry keeps growing as the days go by. However, finding a reliable and dependable contract manufacturing firm to work with is not a walk in the park. One needs to do a whole ton of research about these firms before they can make a final decision on this critical matter.
Most companies are now outsourcing their manufacturing to contract manufacturing firms like Inno manufacturing. Some examples of contract manufacturing are the electronics, medical, and pharmaceutical industries. Usually, there are numerous beliefs, misconceptions, and myths surrounding the industry that most people are confused about what exactly they should trust. In today’s article, we’ll focus on five of the most common myths that are far from the truth. Don’t allow these misconceptions to lead you astray; they include:
Myth #1: There Are No Direct Costs in Contract Manufacturing
The firms that are looking to outsource mostly compare their internal direct costs of labor and materials to the final cost of contract manufacturing. This is not how it’s supposed to be done. The real cost of contract manufacturing is also inclusive of all the indirect overhead costs and any potential opportunity costs.
Fact: Always compare the contract manufacturing cost against your overall costs to make sure that you get the right amount that the project will cost you.
Myth #2: Employee Culture Doesn’t Matter in Contract Manufacturing
Companies in lean manufacturing need to remain competitive. Some of these companies think that they can stay competitive if they don’t establish a long-lasting lean-culture among their employees.
Fact: To thrive in lean manufacturing, the company needs to put its employees very close. Otherwise, all their lean manufacturing programs will dissipate fast. As a company, come up a lean culture for their workflow, attitudes, and relationships: this is will guarantee profitability.
Myth #3: Certification is Irrelevant in Contract Manufacturing
A lot is at stake when you’re choosing a contract manufacturing firm. Literally, all your reputation is in line here. Be very selective and find a firm that is run effectively. Seek validations about the firm because you really need it.
Fact: As to see the firms ISO Certification to confirm that the company is accepted in the industry for following the set quality standards.
Myth #4: In Contract Manufacturing, Lean Doesn’t Apply to The Office
Most companies overlook the lean manufacturing efforts when it comes to their office. They don’t pay much attention to the administrative team and the front office.
Fact: It is very important for your company to implement a lean office culture. This helps to cut down on costs and to ensure that the team is included in profitability awareness.
Myth #5: In Contract Manufacturing, Development Should Stay In-House
The outsourcing companies think that all they need to do is hand the contract manufacturing firm the design or prototype of their product and leave everything to them.
Fact: Involving your development team early enough to work with the contract manufacturer helps to avoid any differences that may arise between product design and the actual production.
Before you can settle on what contract manufacturing company to work with, you have to do proper research in order to find a firm that offers great contract manufacturing services. Now that you are enlightened on the common myths, we really hope that you’re now in a better position to select the best companies to work with. We also hope that you can easily identify firms that are worth not working with.