Bringing Production In House?

Temperature sensor & controls manufacturer Oven Industries was able to use existing personnel to run their line when they brought production in-house.

It’s no secret that many OEMs who’ve tried outsourcing have come away disillusioned and dissatisfied with the outcome. If you’ve tried outsourcing board build to assembly houses, either domestically or overseas, or you’re deciding for the first time which would be the best way to manufacture your product, here are some reasons to consider bringing all or part of your production in-house:

1. Shorter lead times

You don’t need to allot time for the finished product to make its way back for you, production and delivery are less likely to be disrupted by weather events, disasters and political issues outside of your region, and your jobs always have priority in the queue.

2. Quality control

You can inspect every board as it goes into, through, and out of the line, and you are in full control of components, paste, stencils, cleaning chemistries and other materials. All of this allows you to catch errors and problems early, rather than discovering after pallets of the finished product are delivered to your facility.

Sensaphone, manufacturer of remote electronic sensorsand monitoring systems, was doing a combination of manual and outsourced assembly until costs and delivery times led them to bring it all in house.

3. Inventory control

If you produce multiple products, owning your own production gives you more flexibility with regard to your inventory levels—not to mention the ability to develop and manufacture new or upgraded products.

4. Reduced product costs

Capital equipment is an investment that continues to earn for you long after you’ve paid for it whereas outsourced assembly is an expense that you incur every time you need product built. Lost orders due to delivery delays and returns due to quality issues only compound the expense.

5. Complete control of your product or brand

You’ve heard the horror stories of outsourcing in countries that offer no protection or respect to the sanctity of a brand or its products. Bringing your board assembly in-house eliminates those concerns. “Knock-offs” and counterfeits will not be a problem once production is under your roof and under your complete control.

The Bottom Line

How does bringing production in-house compare financially? Use the In-Sourcing vs. Out-Sourcing calculator to get a rough estimate based on your company’s situation. (Note: the calculator does not store any data, nor does it require login or registration to use. None of the data entered is tracked in any way.)