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Internal vs external manufacturing cost feasibility analysis in electronics outsourcing

By VentureOutsource.com Staff

The diagram below shows how electronics OEM executives reduce costs and save money by outsourcing to contract electronics solutions providers vs. keeping manufacturing and related activities in-house (outlined in red). Each of the seven columns (headers outlined in blue) represent increasingly embracing a vertically-integrated outsourcing model to further reduce OEM materials cost.

 

 

(For column seven in the diagram above, read more about purchasing economies of scale here.) And you can see other internal OEM costs are also reduced as the outsourcing OEM program moves internal the contract solutions provider: columns one through seven, above. Read more detailed writing on costs reductions for OEMs working with vertically-integrated electronics services providers here. You also can learn more about the contract electronics quote process and strategy during the OEM RFQ process here.

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Detailed (Advanced) Search for Electronics Services

Advanced search for finding electronics services providers. Search providers by multiple criteria including services offered, end markets served, geography and keywords. Page includes helpful information with links further explaining electronics industry best practices, strategy and more.

Understanding Electronics Services

Contains detailed information on service segments offered by electronics services providers including Prototype and Design Services, NPI Services, Manufacturing Services, Supply Chain Services, Logistics and After Market Services

Various Resource Pages by Topics of Interest

List of 17 popular articles and document content to help electronics OEM decision makers better drive the narrative when seeking, engaging and selecting contract electronics design and manufacturing solutions partners. From the request-for-information (proposal) phase and request-for-quote (RFQ) to EMS quote reviews and proceeding through to the selection of your electronics solutions partner plus suggestions on ways OEMs can announce awarding the business and post selection management of EMS partners.

Best practices for electronics planning, sourcing, forecasting including material liability and risk management, long lead times and shipping schedules management, developing core suppliers, and more.

New product introduction (NPI) including information on bottlenecks, a flowchart on trouble areas regarding BOM management, avoiding pitfalls with electronics NPI programs going to market, and more.

Enterprise resource planning (ERP) and managing your manufacturing in the cloud including comparing ERP software vendors, ERP issues specific to outsourcing electronics, manufacturing trends in ODM white box servers and storage product, and more.

Intellectual property (IP) protection, global outsourcing electronics (ex. China) including global IP strategy, creating regional electronics manufacturing and product markets, interaction with Chinese government owned enterprises, formulating strategy and negotiating with Chinese business leaders, and much more.

Decision-making when selecting providers, contract agreements strategy and formulation including cost reductions and cost containment, purchase price variation (PPV) goals and management, EMS/ODM financial due diligence, and more.

Box build and printed circuit board assembly (PCBA) line best practices including surface mount technology (SMT) line operations and PCBA management, production line downtime management, mechanical assembly and systems integration management, and more.

Program management electronics manufacturing best practices including program management daily activities, managing defense prime contractors and electronics services providers, programs transfer management and tools, how to drive manufacturing teams to improve quality, distributing manufacturing quality alerts across global teams, and more.

OEM Outsourcing Calculator. This calculator can help OEMs uncover hidden costs. Enter and change variables to see how different scenarios are impacted.

EMS industry glossary. An ongoing list of terms and definitions in industry. Let us know what we’re missing. We’re always open to your suggestions and feedback.

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