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9 Contract Metal Manufacturing Considerations for Your OEM Project

Contract metal manufacturing considerations

Contract metal manufacturing is more than a business deal -- it's a partnership. It may be tempting to assess contract vendors based on face value alone, but that can cause more problems than it solves. 

Because contract manufacturing is a long-term commitment, you should vet your vendors carefully.

9 Considerations for Choosing Contract Metal Manufacturing

Getting the most from your relationship with a metal manufacturer means finding the right one for your company. 

When selecting a manufacturing partner, here are 9 things to consider aside from cost:

  • Geographic location
  • Technical capabilities
  • Inventory management
  • Quality control practices
  • Company culture
  • Internal approval 
  • Mutual benefits
  • Scalability
  • Long-term planning

 

1.  GEOGRAPHIC LOCATION

The location for your manufacturer makes a big difference in the nature of your partnership with them. Selecting a local metal manufacturer can put that relationship on steroids and boost your ROI

What benefits do you get by choosing a local metal component supplier?

  • Faster response time to market demands
  • Improved inventory management
  • Lower shipping and transportation costs
  • No offshoring hidden costs
  • Good PR with your community 

 

2.  TECHNICAL CAPABILITIES

Some contract manufacturers specialize in only one or two services. Others offer a full spectrum of services from design assistance to fabrication to finishing and packaging. 

There are pros and cons to single-sourcing your OEM manufacturing. While it can streamline your supply chain, you have to choose your vendor wisely. The lack of diversity in your supply chain is a risk -- especially if something goes wrong.

3.  INVENTORY MANAGEMENT

How a manufacturer handles and stores its raw materials inventory and product stock ultimately affects the quality of your finished product. 

Don’t hesitate to ask about a manufacturer’s practices and experience in managing inventory -- asking can save you a lot of headache later on. 

There’s nothing worse than receiving a completed piece only to find it in poor condition because of weak inventory management practices.

4.  QUALITY CONTROL

Depending on the industry, quality control falls on a spectrum of acceptable tolerances.

Some manufacturers have rigorous quality control standards and expectations. Others are more lax since the products/applications allow for looser standards (which translates into lower costs for you).

Just like with inventory management, don’t breeze over investigating a fabrication shop’s quality control methods. 


5.  COMPANY CULTURE

Contract manufacturing is at its finest when it’s a long-term relationship. 

Communication with your vendor is easier when:

  • You get along
  • Share business practices
  • Have similar values 

 

For instance, if your company is all about environmentally friendly production, find a manufacturer who shares those values. Otherwise, conflict puts unnecessary pressure on your supply chain.

 

6.  INTERNAL APPROVAL

No matter how much you like a vendor, they'll need to be approved by other stakeholders in your company. Are there any deal-breakers for your peers and superiors?

7.  MUTUAL BENEFITS

You're getting a high-quality product, and they're getting a valuable client. What else can you offer each other?

  • Do they have other connections that can improve your supply chain?
  • Are they interested in expanding their offerings or adding new services that you can benefit from? 
  • Are there co-branding or ownership opportunities? 
  • Networking opportunities?

 

8.  SCALABILITY

If you're going to be locked in with one supplier, they need to be able to meet your increasing demand. A vendor that can't keep up will only hold you back.

9.  LONG-TERM PLANNING

Your relationship on day 1 will look a lot different from your relationship in year 2. With the right metal manufacturing company, you’ll be looking toward year 3 and beyond. 

What sacrifices can be made (on both sides) to ensure solid long-term growth and profit? What building blocks can you lay down now to support long-term success?

Contract Metal Manufacturing Is a Commitment

Finding the right vendor who fits your company's vision is something to get right the first time. Think about all of these things, not just upfront production costs.

That's how you'll find long-term success with your contract manufacturer.

 

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