We live in an increasingly globalised society; for instance look at your shoes – added together the different parts they constitute of, have probably been to more places around the world than you have.
Outsourcing of manufacturing is part and parcel of every business nowadays, so much so that companies almost do so instinctively. However, there are also plenty of benefits with keeping the manufacturing process in house.
Of course, the foremost advantage for keeping things in house is the flexibility. Instead of having to contact businesses the other side of the world to change something, add something or contribute an idea; one department merely has to meet the other. If something needs changing, if there’s a problem or if you come up with an innovative idea, all you have to do is inform the other department.
React to market quickly
This pacey and flexible manner of contact allows businesses to move through the design, engineering, product development and production phases quickly and easily. If needs be they can change one of the areas quickly and react to market changes almost instantaneously.
In the case of outsourced production numerous issues can come to the fore. For instance, if a change is required to meet market demands and the production company doesn’t make the part, what do you do?
Options are limited – do you move to another factory, end contracts early; or do you merely fail to react as the cost of changing manufacturer is too much of a financial burden? In house manufacturing allows a business to react to the market quickly and change their products suitably.
|Stella Doradus’s Chip placing machine in action. All their products are manufactured in-house.|
Rapid testing of prototypes
We’ve previously mentioned the interlinked processes of design, engineering, product development and production. With in-house manufacturing a company can test prototype products in-house, discuss issues with engineering and design departments in house and then change what needs to be changed. Instead of having to ship prototypes across the world, it can all be done quickly and easily within the business. This radically speeds up the whole process and cuts out what can often be weeks in between prototype creation and testing.
It also means quick customisation can be achieved – something that greatly benefits smaller companies, especially those with bespoke manufacturing tendencies. If a customer wants a customised item or product, this can be easily done in-house, in a fast and easy fashion.
If the customisation is to be outsourced, it has to go through a range of channels and processes and there is a higher likelihood of an error. This higher chance or fault is down to instructions getting lost in translation and a Chinese whisper phenomenon – something in house customisation greatly limits.
Many businesses who offer bespoke or customised products often won’t find the benefits of outsourcing products nearly as enormous. As these companies often only manufacture small numbers of products and use few components, they don’t often benefit from the economies of scale that mass production allows.
For them in-house manufacturing may not cost a significant amount more than outsourcing it. However, the amount of control they have over their production will significantly outweigh and manufacturing savings.
With in-house manufacturing, each business has to take benefits and disadvantages on their own individual merit; however there certainly are a range of pluses to consider.