Is Outsourcing Right for You?

Carefully consider the following questions to determine if outsourcing is a viable option for you. Even if you are just starting out, and are not sure what is involved in the actual manufacturing of your design, review these questions carefully, answer them as best you can, and when researching outside vendors, include them as part of your decision making process.

Define your design

• Do you believe your design requirements are too complex to be handled by an outside source?
• Do you have drawings readily available?
• Do you need packaging and design assistance?
• Do you need prototypes?
• Has your design been bread-boarded?
• Do you perceive that your design will have issues with manufacturability?

What are your manufacturing requirements?

• Do you understand the design rules for manufacturing your module?
• Can all or part of the manufacturing process be automated, or does it have to be done manually?
• Is a particularly complex process involved in manufacturing your module?
• Does your module need to be made in a clean room or a unique environment?
• Do you require specific vendor qualifications, such as AS9100, telecordia, or military certification?

What are the assembly requirements for your design?

• Can you define your assembly requirements?
• Does your design require unique equipment and/or processes?
• Are there other secondary operations required?
• Do you want secondary operations to be completed at one location, by one source?

What are your testing requirements?

• What tests and quality control measures are required?
• Is unique equipment needed for your testing requirements?
• What are your needs in terms of volume and scheduling?
• What are your volume needs for:
  • Prototypes?
  • Pre-production?
  • Full production?
• Are your volume needs such that meeting them in-house poses a significant challenge?
• Are your volume needs such that they justify the existence, or creation of an in-house manufacturing department? (This can include hiring additional personnel, equipment purchasing, ISO certification, and much more.)
• What is your required time-to-market?

If you are currently manufacturing in-house, will you be able to continue meeting your customers' needs?

• Do you have the latest equipment, software, and peripheral technology?
• Does your facility meet your current manufacturing needs and future goals?
• Do you have adequate manufacturing space?
• Is your staff fully trained and qualified?
• Are you over or under-staffed?
• Will you be able to continue to meet the quality, on-time, and price requirements of your customers?

Will outsourcing help you create a balance between the price of your process versus the price of your product?

• Is the cost of keeping manufacturing in-house more than the cost of outsourcing?
• Will the costs associated with in-house manufacturing decrease your gross margins?
• Would the manufacturing space you currently use be more beneficial or more lucrative if used for a different purpose?
  

More about outsourcing:

• Outsourcing benefits
• Is outsourcing right for you?
• Choosing the right manufacturer
• Raytheon and Natel - An Outsourcing Success Story