Every year, more than 30,000 new products are introduced to the world. Initially, the companies that come up with these products will often handle manufacturing on their own.
But as time goes on, it can get to be more and more difficult for companies to keep up with the demand for their products. This is when contract manufacturing services can step in and help.
A contract manufacturing service is a company that specializes in the production of products for another company over a set period of time. They’ll typically create the OEM parts for products and figure out the most effective ways to put them all together to leave companies with the products they’ll go on to sell in the end.
Are you wondering if your company should hire a contract manufacturer? If so, you should learn about all the contract manufacturing benefits. It’ll help you decide if it would be the right decision for your company to make.
Here are some of the top advantages of working with contract manufacturing services.
You Won’t Have to Buy or Lease Manufacturing Space
There are almost 600,000 manufacturing companies operating throughout the U.S. these days. If you’d like to turn your company into one of them, you’ll need to either buy or lease manufacturing space.
As you might imagine, this can be very expensive in most cases. You’re going to be looking at spending tens of thousands and maybe even hundreds of thousands of dollars each year on a space.
Working with one of the best contract manufacturing services is an easy way to get around having to do this. You’ll be able to let this service worry about doing all your OEM manufacturing in their own facility. It’ll eliminate what would be a massive expense from your budget and give you the freedom to spend your money elsewhere.
You Won’t Have to Buy Expensive Manufacturing Equipment
If you attempt to do manufacturing on your own versus hiring a contract manufacturing service to help, you’ll need to do more than just a manufacturing space. You’ll also need to fill it when all the equipment you’ll need to bring your products to life.
More often than not, you’ll have to spend weeks and possibly even months researching all the equipment you’ll need. From there, you’ll then have to pay astronomical prices to get your hands on this equipment so that you can begin using it.
As if all that wasn’t bad enough, you’ll need to take care of maintaining and repairing all this equipment in the months and years to come, too. This can turn into a huge headache.
Wouldn’t it be nice to rely on a contract manufacturing service that’ll have all the right equipment already available? It’ll be another thing you won’t have to worry about when it’s time to start manufacturing your company’s products.
You Won’t Have to Hire Manufacturing Workers
Did you know the average company spends at least $4,000 to hire a single employee? From marketing an open position to conducting interviews to providing the proper training, it can be costly to bring a new employee on board to work for your company.
Now just imagine how much money it might cost you to fill a manufacturing space with all the workers you’ll need to hire for it. You might end up spending a small fortune to get access to the labor you’ll need.
You won’t need to worry about doing any of this when you work closely with one of the best contract manufacturing services around. They’ll have a dedicated team of manufacturing workers who will be able to produce the products you need without you having to hire and train them.
You Won’t Have to Worry About High Overhead Costs
At this point, we’ve touched on how much it’s going to cost you just to buy or lease a manufacturing space, fill it with the right equipment, and hire workers to help operate it. But believe it or not, the costs won’t stop there if you choose to manufacture your own products!
You’ll also be subjected to your fair share of overhead costs. You’ll have to pay for everything from electricity to run your equipment to insurance to keep your workers and building safe.
These overhead costs can crush your company and put you in a position where you won’t be able to afford to have a product fail. If you aren’t able to sell enough of a product, your entire company might end up having to go out of business since the overhead costs will eat it alive.
You Won’t Have to Figure Out How to Scale Up or Down
We’ve talked a lot about how working with a contract manufacturing service will save your company so much money. But it’s worth noting that this is not the only way in which a contract manufacturing service can assist you.
As time goes on, there is a good chance that your company will want to scale up or down based on how successful your products are. A contract manufacturing service is going to give you the freedom to do this.
All you’ll need to do is let a contract manufacturing service know that you’d either like to ramp up the production of a product or scale back on it just a bit. They’ll be able to provide you with flexibility you wouldn’t have while manufacturing this product on your own.
If you were to try to scale up yourself, you would likely need to move into a new building, buy new equipment, etc. If you were to scale down, it would probably require you to sell off some equipment, cut ties with some workers, etc.
You should avoid having to do any of these things by simply trusting one of the best contract manufacturing services to help you. They can work behind-the-scenes to help you scale up or down without you having to do it yourself.
You Won’t Have to Stress Out Over Production Delays
When you first begin working with a contract manufacturing service, you’ll put some kind of an agreement into place. You’ll ask this service to produce a certain number of products for you by a certain date and leave it up to them to figure out how to get it all done.
If this service encounters any production delays on their side, they’ll have to find a way to deal with them without missing the deadlines you set. This might mean asking workers to work more than usual or making adjustments to their production process.
These are things you won’t have to get stressed out about anymore when you count on a contract manufacturing company to help you. Production delays aren’t going to derail your company’s plans anymore.
You Won’t Have to Be Concerned About Quality Control
Remember how we mentioned that about 30,000 new products hit the market every year back at the beginning? One thing we didn’t bring up is that about 95% of those products fail.
Products fail for all kinds of reasons. In some cases, they aren’t marketed properly and not enough people find out about them. In other instances, there isn’t as much demand for products as companies thought there would be.
But the vast majority of products end up failing due to quality control issues. These products are produced by companies that aren’t 100% sure what they’re doing when putting together a production process. It leads to QC issues popping up with products and taking a toll on them from the start.
When you let a contract manufacturing service worry about quality control, you’ll find that your products will turn out so much better. They’ll be created by a company that knows what it’s doing when it comes to producing products that’ll look great and last for a long time.
You Won’t Have to Deal With Inventory Issues
If your company was to take on manufacturing its own products, you would need to stock up on all the supplies it would take to create them. Before long, this could turn into a logistical nightmare.
Why? Well, here are some of the things you would need to worry about with regard to these supplies:
- How many of them to keep on hand at any given time
- Where to store them while you’re waiting to use them
- What might happen to them while they’re sitting in storage
Dealing with inventory in a manufacturing space can be troubling. You might run the risk of not keeping enough inventory and run into production delays. You might also run the risk of keeping too much inventory on hand and struggle to find places to put it all.
The contract manufacturing services you can work with will all be able to help you with inventory issues. They’ll be in charge of finding the most effective ways to manage inventory in their manufacturing spaces.
You Won’t Have to Worry About Updating Manufacturing Processes
The manufacturing processes that you might use now to create your company’s products might not be the same processes you’ll use in, say, 2 years. The manufacturing industry changes fast, and if you’re not able to keep up, it could leave you behind in the dust.
In order to keep up, you’ll need to get into the habit of updating your manufacturing processes. You’ll also need to update any technology you might be using to carry out your manufacturing processes.
As you can probably guess, updating your manufacturing processes and your technology can be costly. It might start to feel like you’re spending money to make updates every time you turn around.
But what might be even worse is that you’ll constantly feel pressure to make tweaks and updates to your manufacturing processes. It might actually keep you up at night.
You can take all of this off your plate by checking out the contract manufacturing services that are out there. They’ll be able to handle updating their own manufacturing processes over time to keep up with your production demands.
You Won’t Have to Neglect Other Areas of Your Business
Manufacturing your company’s products is obviously one of the most important aspects of your business. But it’s far from the only aspect that’ll need to be on your radar.
You’ll also need to be mindful of how your company is marketing your products. You’ll need to spend time thinking about how your company is spending money as well on the accounting side of things.
It’s going to be very difficult to manage all these other aspects of running your company when you’re so busy managing the manufacturing that’ll be going on. It could result in you neglecting some areas of your business and your company suffering because of it.
With the help of a contract manufacturing service, you’ll get the opportunity to focus on every other area of your business. As long as you make the most of this, it could lead to your company steadily growing over time. It should also help your bottom line in a big way.
Take Advantage of Contract Manufacturing Services
In a perfect world, your company would be able to handle all your own manufacturing needs. But for many companies, this just isn’t practical. It makes so much more sense for them to hire contract manufacturing services.
Now that you’re aware of all the contract manufacturing benefits, you should take full advantage of them. They’ll enable your company to take things to the next level. It’ll also increase the chances of your products succeeding when they hit the open market.
Shield Works would love to help your company with all its manufacturing needs. Contact us today to see how we can assist you.