Proficient Sourcing LLC exists to help you find excellent suppliers so your outsourcing will be successful. There are many factors involved with outsourcing, and it’s always educational to check the internet to see the pros and cons.
Fortunately, we found no new revelations. But depending on your business there are certainly many things to consider.
In most cases we know, an OEM seeks manufacturing resources not available within the company, or perhaps beyond current capacity. This entails some loss of control, despite all standards and specifications to be followed. If the supplier is beyond easy visit distance away, the control loss problem is probably increased.
This loss of control is the primary con to outsourcing. The OEM is asking a completely different organization to do something that’s to be consistent with the OEM’s company identity and desires. If this involves a foreign entity, a greater risk is involved.
Generally, proximity to the OEM is a highly desired factor. There’s no substitute for visiting the supplier, where the OEM can easily see what’s going on. No remote reporting and even something like Zoom can substitute for an eyeball-to-eyeball check up on a company you are interested in.
The main pro, of course, is the acquisition of capability beyond that of the OEM. Once discouraged in the good ol’ days of Henry Ford, outsourcing is standard for the manufacture of most things now. One of the main advantages to the OEM is not having to deal with a number of hires and their attendant management requirements. The OEM can focus their attention to other things.
Similarly, if the selection is wise, the supplier will possess a great deal of the needed skill and have all the personnel issues the OEM can avoid. In fact, this can become a great advantage. The correct supplier choice will not only possess a specific capability and skill needed but will also have the incentive to generate improvements. Initiating improvement increases the supplier’s value, thus making future business more likely. A win-win for sure!
One important thing the OEM can do to increase confidence in a supplier is to investigate the supplier’s history. Some evidence of experience with the desired manufacturing is always good, along with some evidence of a history of happy customers.
Proficient Sourcing LLC is primarily interested in your supply requirements for new metal and plastic parts and assemblies. Large or small, one or many, we’re prepared to supply candidates immediately once we learn of your requirements. Our recommended companies are selected not only for their manufacturing capability, but also because they do have a history of performance and happy customers.
It’s our mission to minimize the con’s and maximize the pro’s!