OEM companies engaged in quoting exercises for new product introduction (NPI) business services with contract manufacturers can expect the capable contract manufacturer to carefully lead the OEM through an established and itemized list of NPI product requirements and processes.

While there are some common outsourcing manufacturing contract formats, no two contracts are identical and, there is no viable, common platform that can be applied to every outsourcing contract pricing model with regards to either party’s profits.

Our survey asked electronics contract manufacturers, original design manufacturers, and prototype houses to rank, in order of importance, their top 5 improvement opportunities. Read what they selected.

This article breaks down the outsourcing cost and savings analysis for an OEM outsourcing program while also presenting the contract manufacturer’s cost of performing supply chain management services for the OEM customer’s business.

Program management responsibilities inside the contract manufacturer can vary based on the type of products going into production and the industry in which manufacturing takes place.

Startup executives can refer to this plan to help them review internal depth and scope capabilities against anticipated company capability requirements so they may then determine at what point it may make sense to consider evaluating and engaging a contract product design partner or contract manufacturing partner.

This pricing model framework is easier for both parties to administer the relationship while it is also easier for the contract manufacturer to track and manage internal costs.

Typically, contract manufacturers will purchase specified quantities of long lead time material and OEM customer-unique materials only when the OEM customer authorizes such in advance and in writing.