A contract manufacturer is a company that comes in and helps take over part of the production process for a business. Many benefits can come from working with a trusted contract manufacturer, including cutting costs, scaling up your production capabilities and improved quality control.
If you’re finding that your business is outgrowing its in-house production capabilities, now might be the perfect time to begin the search for the right contract manufacturer. This can be a somewhat daunting process, as outsourcing some responsibilities of your business takes trust and a certain level of commitment.
To help you find the right fit, we’ve put together this guide of what to look for in a contract manufacturer. While some of the specifics will depend on the needs of your business, these tips should help you get well on your way to finding a reliable, professional and well-esteemed contract manufacturer.
A strong company reputation
The last thing you want to do is outsource your production to an underqualified or inexperienced contractor. To avoid this, put in the work and do some research into the history, reviews and legal and compliance history of any potential sourcing services companies.
Luckily, these days there are plenty of digital resources readily available for you to do this. Don’t be afraid to reach out to any relevant industry connections that you have and ask them for any insight that they can offer, and be on the lookout for any red flags such as a lack of an online presence or transparency when asking them for testimonials.
Relevant product experience
Just like you wouldn’t hire an employee without the relevant experience for the position at hand, you wouldn’t hire a contract manufacturer without experience in your industry. Certain companies might have glowing reviews and years of experience in other industries, but none of that matters if they don’t have a proven track record in your field.
Choosing a company with the right product experience means that they know exactly what you need and how you need it. This minimises the margin of error and gives you a higher chance of a successful working relationship that’s easy, to the point and allows you to focus on the other areas of your business rather than micromanaging your contractor.
During your early stages of finding contract manufacturers that include your feasibility reports and analyses, consider all the costs that come along with outsourcing these tasks. This includes shipping, packaging, fees and regulations and compliance.
If these costs are lower than the price of scaling up your own production capabilities, then a contract manufacturer is the way to go. If not, then the process isn’t worth it and you may end up spending more than you save.
One of the most important things to look for in a contract manufacturer is one that can handle the capacity of what they’re able to handle. There’s no use going to all the effort of outsourcing your production processes if your chosen contractor can’t meet the demand that you need.
The right find for you will be able to provide you with additional production and storage space without you having to source and pay for it yourself. This is an integral part of your contract manufacturer being able to grow with you, and be able to properly address the needs of your projects.
To properly meet the needs of your business, your contract manufacturer will have all the appropriate equipment and technology on deck. This can mean already having the tools themselves, being able to procure them or lease them from your business.
Make sure to ask all these questions before you make a decision and are fully aware of what they’re willing to do to meet your needs. It’s worth noting that most companies will be willing to source the equipment you need even if they don’t have it already to close the deal and get the job done right.