About 50 years ago, every electronic component of an electronic commodity was built by the same organization that produced the ultimate product. This implied that the manufacturer had to buy the raw materials, hire experts, take inventory for every single component which goes into the item. Additionally, this made it remarkably difficult for small organizations with small runs to get into the market and bid favorably.
The market was ready for ‘electronic contract manufacturers’ that specialized in the design and manufacture of specific components that would then be sold to the Original Equipment Manufacturer (OEM) to be placed in the final product. Narrowing the focusing of a company to just one product or component, allowed them to offer economies of scale in the acquisition of raw materials, talent and expertise in the design process, and equipment for production. This cuts costs for the original manufacturer and frees up their capital.
With this new structure, manufacturing companies were able to produce a better product, more efficiently, and easily scale up or down to customer demand. In the design development process, usually the most complex and difficult part of the process, a contract manufacturer is more likely to accumulate a team of experienced engineers that will focus their expertise on the specific component. In the production process, they are more likely to keep up with the latest, high tech equipment and state-of-the-art technology.
Suppose there’s an issue with one of the parts. In case the manufacturer is creating all the parts in-house, it might take a while before it’s found – and perhaps even after it has reached the end-consumer. In addition, the problem has to be solved using in-house resources and capital. When pulling together with a contract manufacturer, in numerous cases component defects have previously been caught long prior they get to the OEM – usually as a result of encounters with other manufacturers. Frequently a third-party opinion of the issue is what’s required, and the resolve is individually on the shoulders of the said third-party.
Because an ECM just buys materials for the parts they produce, they’re able to buy in bulk providing the OEM plentiful cost savings. And because they’re buying from their personal supplier in higher frequency, the manufacturer takes the advantage of the powerful relationships developed.
Finally, the contract company will thoroughly test the components they provide for quality. They will be at the lead of technology suggesting improvements and improving their product in order for it to last longer, work better, and is more convenient. This is can be a daunting exercise for the original manufacturer who has numerous components to keep up with.
WHY YOU NEED ELECTRONIC MANUFACTURING SERVICES
Honestly speaking, Electronic Manufacturing Services is helping us all the time and that’s why we need to partner with them. From small common electronics to large device equipment, we can’t possibly believe our life minus electronics. So, this cannot be made without the help of Electronic Manufacturing Services. Presently, these services have turned out extremely convenient and common. Many companies are upcoming and the tightened competition has made a decrease in overall prices. Additionally, with countless competitors, modern and more forward-looking tools are rising every day. Electronic manufacturing is, therefore, a major reason why people are exploring technology so keenly.
There are many ways EMS help us in our daily lives. They make everyday proceedings convenient and easy for us. Here are some other ways:
Commonly Used Electronics
Around us, there are so many electronic devices. Several of these are so commonly used that we never stop to think about their usefulness. An example is that of mobile phones. Almost everyone uses these handy devices. However, do we ever stop to think how easy they have made our lives? Mobile-phones have offered immense comfort and improvement in the communication network. While several of us do not know this, such inventions are made possible because of electronic manufacturing services.
A great way EMS is helping us today is by making everything conveniently simple and straightforward. Computers, for instance, are so widely used that no one stops to think about the technicalities involved in the manufacturing process. While we see the results on a computer within seconds, it is actually a very complex process. In fact, electric charges are sent through the computer using complex copper paths. These communicate with several parts of the circuit board of the computer. These parts perform their individual functions in order to display the results on your screen.
These common devices, however, are not the only ones provided by EMS providers. There are a number of other services they offer in order to make technical processes easier. Businesses that are making and selling items like cell phones, computers, and other technological items can hire EMS providers to do several jobs for them. One of these is designing products. Experts can be hired to get a general idea from you and to develop it into a technical design for an electronic product. This is highly beneficial since hiring experts ensures that your product design conforms to the latest trends and requirements. Also, hiring experienced designers means that you will receive a wide range of ideas and, therefore, come up with the best version of your initial idea for a product.
Help In Management of Other Important Aspects
Apart from designing products, EMS providers can also help you in managing certain tasks after your product has been completed. They can, for example, manage the supply chain of your product and help with its distribution throughout the world. You do not, therefore, have to hire different services providers to distribute your completed product. Moreover, most prototype pcb assembly providers work according to certain contracts which guarantee after-sale services. If, for instance, your product has been distributed globally but a problem is found later, your EMS provider can help you by analyzing and repairing this flaw.
Electronic Contract Manufacturing
EMS does not only help individuals. In fact, they also provide a wide variety of services for businesses. Almost every business hires an electronic contract manufacturing company for its manufacturing department. This is because every factory needs advanced machinery in order to be able to produce goods. To make sure that the best and the most advanced machinery is provided, businesses are often on the lookout for electronic contract manufacturing services. These companies, as the name suggests, are hired on a contract basis. This means that you can make use of several useful packages. This way, you can get a number of services at a very low price.
Apart from being useful for manufacturing departments, EMS also help other business departments. For example, the accounting and sales departments need advanced computers in order to record transactions and calculate profits. EMS provide these devices to make sure that there are no accounting errors. Moreover, other electronic devices like time clocks are also used by several offices. These let the mechanization of daily responsibilities like coming up with the workers’ attendance.
The importance of Electronic Manufacturing Services can also be realized by the fact that there are several electronic devices that have now become an integral part of our daily lives. Cell phones, for example, are heavily relied on by people in every sphere of life. In fact, several of our everyday tasks would be left incomplete if these devices were eliminated from our lives! EMS, therefore, happen to be one of the most important industrial processes operating today.
WHAT TO DO BEFORE YOU DECIDE TO EMPLOY AN ELECTRONIC CONTRACT MANUFACTURER
Before getting in touch with an electronics contract manufacturing company, a client needs to do several things to make sure that the whole process goes as smoothly as possible. If they don’t perform these things, the business which they want to engage with the company is going to possibly fall apart. Here’s is what you need to first do:
> Analyze The Specifications
The primary thing which the client ought to do is to examine the terms and have a pretty nice idea what the product requires to perform. The person placing the order might want to make a list of things which it requires to do. In case the customer just has a nebulous idea of needs, it’s going to be all but impracticable for the company to do it correctly. The individual placing the order has to be in a position to tell the agent exactly what they’re searching for and have a few kinds of specifications accessible.
> Create A Timeframe
The client ought to also make a timeframe prior they contact the potential electronic contract manufacturer. The individual ordering ought to know the amount of time they have until they require the item. This manner, the company should be able to decide whether it’s even feasible to produce the item in time. Several people think that they can order items and have them arrive any time they want, but this isn’t usually the case, especially in cases of complicated items, like printed circuit boards (PCBs). There’s a specific amount of time which must be spent on making the products, and this can’t be bypassed. The customer requires to be certain that this amount of time is going to work with their schedule.
> Make A Budget
The client should also have a budget in mind. When unique products are made, the cost can vary tremendously, depending on the specifications. The customer needs to figure out how much they can afford to spend on the project. This will not change how much it costs, of course, but it can let the company know if they can produce the item without going over the budget. If they cannot do so, they need to know this right away so that they can inform the customer. The client can then decide if it is worth it to increase the budget or if the transaction will not be possible.
Overall, the person placing the order needs to have this information on hand so that the electronics manufacturing company can determine whether the order can be processed in the way that is required in the time requested. If it cannot, the electronics manufacturing company can then work with the client to find the ideal solution.
CHOOSING ELECTRONIC CONTRACT MANUFACTURER TO HIRE
For several companies, particularly small to medium-sized ones, acquiring a contract manufacturing associate is not only a great idea, but it’s additionally essential to the success of that business. Apart from quality requirements and pricing structure, there’re numerous other items which ought to be taken into account when choosing a good potential partner or simply an electronic contract manufacturer:
1. Compatible Objectives
Some companies may only be interested in the amount of money at stake. While it is important that the numbers match up for the benefit of both parties, find out what their main driving force is. Larger contract companies may be interested in smaller manufacturing companies if they offer the opportunity to gain experience in an industry that is new to them. Or a product that has big growth forecasts.
Learning the answers to these questions is important before proceeding to the long process of submitting an RFP, and more critically, entering a partnership. Additionally, a solid ECM company should be able to keep up with the client’s – your company – ever-changing needs regarding its chosen market. For this reason, the manufacturing process should be multi-tiered to at least three levels. In other words, an ECM company’s manufacturing abilities profoundly depend on its engineers’ specialization, facilities, and project management experiences.
So if the business principles do not match up, the OEM may not get the attention they need to make their product successful.
2. Provide Accurate Forecasts
To understand this aspect better, let’s discuss the inventory in discuss; Every manufacturer has inventory and lists it on the balance sheet as an asset. But, from an operations management perspective, is inventory really a good thing? Too much inventory ties up precious resources but too little can cause lost sales. So, what inventory should one have – you want the right quantity of the right items at the right place and time. In order to determine what that is, you first have to look at why you have inventory in the first place.
For a manufacturer whose customers expect immediate delivery, you will need enough of the right inventory to meet the demand. The implication is that you know what that demand will be – meaning you need a good forecast.
Forecasting is difficult and seldom accurate, so you are still at risk of not having the inventory you need, and probably will have too much of what you don’t need. Running out of something is likely to result in lost sales, so companies decide to “pad” the inventory of popular items, assuming the extra investment is worthwhile to avoid losing business opportunities. I at all this happens to be a deliberate decision, correctly justified, then you can let it be.
But inventory appears to be complicated. Perhaps the product isn’t as much popular as it sometimes was. Businesses usually revise these inventory judgments and what was already a perfect investment to better customer service turns out to be an undesirable drag on company space, resources, and funds.
The same concept applies to products that aren’t required for direct delivery. Whenever the acceptable lead time to the customer is shorter than the actual lead time to make or procure the product, it takes inventory either on hand or in the pipeline to be able to meet that customer expectation. In this case, the amount of inventory needed is equal to the expected demand (usage) during the time it takes to get more – known as the resupply lead time. Then, of course, there should be some additional inventory (safety stock) to accommodate variations like higher-than-expected demand during the resupply period or perhaps a late delivery from the supplier.
Enterprise computer systems often include inventory management and forecasting applications that can measure demand variation (forecast accuracy) and manage the amount of buffer inventory needed to meet your customer service objectives. But the real secret to success is to work at improving forecast accuracy because that will let you reduce inventory without harming service level. Accurate inventory information is also critical – the system can’t manage inventory if it doesn’t know what you have.Note that another source of inventory is related to how it is procured – volume price breaks, shipping costs, minimum purchase quantities, economic lot sizes and the like will increase the initial quantity on-hand but these extras should be used up in the normal course of business and are not usually the source of an inventory build-up.
Inventory can be viewed as a necessary evil – a significant cost in most companies that is justified by the role it plays in reducing lead time and covering for the unexpected. The secret to making the most of your inventory investment is in knowing just how much you need – the right amount of the right products or parts at the right time. And that comes down to good forecasts and intelligent buffers. It’s not magic. It’s just good operations management.
So, in electronic contract manufacturing, no one knows where an original manufacturer plans to go unless they see a well-developed forecast. If they want to make the most of the partnership, they need to inform the contract manufacturer about where they have been and where they plan to go in the future. This provides needed credibility.
The contract manufacturer will need to know what level of risk they are signing up for while determining what level of resources will be needed to meet the requirements. Will they be able to purchase materials when needed, will they be able to handle the inventory?
3. Expectations Regarding Inventory
Resolving up front what the plans and responsibility for inventory are within the two companies are going to minimize the chance of surprises and conflict. Understanding supply chain management and inventory problems, and actively making attempts to decrease exposure, is important when forecasts don’t match up to sales, or a disaster occurs.
4. How Mill The ECM Handle Product Changes
With electronics evolving at a lightning speed, improvements are bound to happen fairly frequently. Finding out the favorites for handling product variations, and the process they have put in place in executing them in the past with other users is very important.
Determining the level of responsibility expected by each participant in the analysis, change proposal, and implementation is crucial for the resolution of the partnership and the item itself.
Partnering with a company which has a huge amount of experience in the various phases of a commodity lifecycle will offer important input in the different phases. So, this experience, and also the documentation process, ought to be discussed.
5. Modern Facility
Ideally, you should always check the equipment being used by an electronic contract manufacturing company. You must ensure that all the systems and tools being utilized by them are up to date. You ought to never make a deal with an ECM company minus first touring their facilities. Equipment ought not only to be contemporary but also have to comply with the most current industry standards.
A great company will ensure that the most sophisticated technological equipment is utilized to perform your project. Since antiquated equipment can make your electronic equipment to be somehow limited, this is an essential factor. You can send a representative to visit them on the site. But better yet, schedule a trip and see their facilities and equipment for yourself.
A good company is going to also ensure that the manufacturing process is broken into stages, so as to circumvent any potential errors.
6. Design Service
ECM engineers should at least have a couple years experience in the manufacturing industry. A nice company is going to always ensure that it offers the ideal specialists to deal with ECM responsibilities, even though this comes at a higher cost. additionally, the professionals of a great company will usually be qualified professionals in areas like mechanical and electric engineering. They will likewise have much experience with related projects. Their specialization ought to include but not limited to the following;
It’s additionally a great sign in case the company has dealt with small to large schemes in the past. So, don’t fall for a company providing alarmingly low costs. This is because such a company can have amateur designers who don’t demand large payments for their work. Even if you have to pay a higher price, don’t compromise on the experience of the designers.
7. Project Management
A good electronic contract manufacturing company will not only focus on the tasks but will also make sure that it plans them properly. Project management will be the first step for any good company. A thorough plan of action must be devised. Also, this plan must be specifically created according to the needs of your business. If a company can not manage a certain project, it can not possibly manufacture advanced equipment.
Therefore, ECM company should be able to demonstrate good project management. If it can’t even present itself well in this stage, how do you expect it to manufacture complex electronic equipment? Generally, a solid project management plan should lead you through the project’s concept development, pcb engineering design, the device’s prototype build, device testing, and design for volume manufacture.
For any ECM, relationships are critical. As a company, you must be convinced that your manufacturing is going to be through in a timely manner — not shifted back since something else just came along.
What is good, is a solid relationship with an electronic contract manufacturer, from the prototype level to the full production level. This offers the manufacturer a complete understanding of your stock and the capacity to recognize any manner to fix it while sidestepping costly delays and pitfalls. This commitment to a real relationship makes sure that you receive the time, patience, and resources needed when developing an item that has been created and optimized for attribute and price efficiency.
9. Staying Competitive
Any great ECM ought to be focused on assisting you to stay competitive. This is especially true if their specialization is operating with small to mid-sized organizations. This might include a diversity of processes extending from assisting you to stay updated with production trends to assisting you to prepare for different regulations related to your components or products.
As a result of the various components and products which rely on efficient CM, a good manufacturer should be in a position to exhibit a high level of flexibility as far as its processes, structure, and equipment are concerned. Flexibility is definitely needed when it gets to accommodating different products, customers and timelines. But, remaining flexible is not limited to providing a diversity of services, like supply chain management, PCB assembly, inspection, and BGA repair. Remaining flexible additionally implies having a powerful distributor association for greater cost reliability and efficiency.
MONITORING YOUR ELECTRONIC CONTRACT MANUFACTURER
Now, having masted all the necessary factors you need to consider before partnering with your chosen electronic contract manufacturer, there’s something you still need to do. That is, you need to keep monitoring the company to confirm whether or not you made the right decision by hiring it before things go too far.
For big businesses, the administration of the manufacturing unit can be especially difficult. The method has been considerably complicated as a result of the fact that latest technologies are arising each day and, usually, it’s not simple to ensure that all the technical jobs are managed with state-of-the-art expertise. There’s a need to make sure that all the technical tasks related to the manufacturing department are handled effectively. Therefore, just as a reminder, this is the reason why several companies are now hiring electronic contract manufacturers.
Simply because these service providers can manage the technical tasks at pretty low prices. Normally, they can provide charming units for long-term management. While it surely is effective to employ an ECM company, the truth is that it’s very hard to separate the genuine providers from scams…At this point, there’s truly no need to panic as the pointers discussed above will help you in getting the ideal one for you.
However, just like I have mentioned above, it’s extremely essential to monitor the services being offered and to ensure that you have made the best choice. Nevertheless, you’re not familiar with technical tasks, it can be fairly difficult to determine whether the electronic contract manufacturing company you have hired is working properly.
Here are some tips that can help you in ensuring that the work being provided is adequate.
Observe The Initiation Techniques
This is the most important phase since it can tell you whether you have made the right choice. Observing how a company begins their work is the key to judging their abilities. It can also help you with potential problems since you can immediately terminate a provider who does not start off the work in a good way. You must make sure that the employed electronic contract manufacturing company kicks off the work by planning the tasks that need to be completed. This signifies effective insight, which is very important for success. Make sure that your service provider knows what to do before beginning to do it.
Confirm The Experience
This is actually one of the considerations you made before hiring. But, you will need to keep an eye on the same again to confirm that you made the right choice. When monitoring the work, you must judge whether the workers are experts. How are they responding to the duties being presented? How long does it take them to come up with a plan of action? Answering such questions can help you in judging whether the people working with you are experts or amateurs.
Monitor The Manufacturing Techniques
Remember that the purpose of hiring an electronic contract manufacturing company is to make sure that you stay up-to-date with what is happening in the technical world. Therefore, just like it is discussed above, you must ensure that the hired service providers are using the latest equipment and the most recent techniques to complete the manufacturing process.
An electronic contract manufacturer is a professional in the components they develop and offer. This expertise provides extreme value. Therefore, if you are trying to reduce the costs of the manufacturing, just move on with your outsourcing to an ECM firm. One thing you need to remember when you are doing this is to always consider the pointers discussed above, and your company or business is going to be in the good hands.
Now, after reading this article, you will be on your way to looking for a reputable electronic contract manufacturer. Look no further because RayMing Technology is the business partner you need. Our company provides unmatched quality PCB manufacturing and turnkey PCB assembly services for electronic industries and with 10 Years PCB manufacturing and PCB assembly factory. Contact us today or visit our website www.raypcb.com