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Contract vs. In-House Metal Manufacturing Assembly Services: 4 Cost Factors

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Cost control is a chief concern in most industries, and manufacturing is no different. It’s a prime motive for using contract metal manufacturing assembly services rather than maintaining in-house assembly, or vice versa -- or perhaps some of each. The choice depends on your needs and your potential partner’s capabilities.

Here’s how to figure out which assembly strategy is best for your business.

Metal Manufacturing Assembly Services: What You Need

It helps to have a checklist of expectations for your assembly team, whether it’s in-house or external. Qualities you may be looking for include:

  • Flexible with product volume: Can your contractor’s assembly be fine-tuned to handle any volume? You may be better off keeping a small-volume project in-house.
  • Highly complex assemblies: Can your contractor follow through with an intricate assignment?
  • End-to-end assembly: Can your contractor build your product from start to finish?
  • Other services: Could you use more than just assembly assistance from your provider?


Cost: Contract vs. In-House Metal Manufacturing Assembly Services

When deciding between contract assembly services and in-house assembly services, you should look at these four factors:

1. Labor

Keeping assembly services in-house means needing more staff. Needing more staff means more wages and benefits for your company to undertake.

An outside contractor assumes the burden of all costs associated with labor. But, depending on the market and location, frequent use of top-dollar contract assembly services can cost more in the long run.

2. Flexibility

In-house teams have a certain amount of built-in flexibility, as you can move staff around as needed. However, if you’re not hiring new staff for assembly, you may find yourself stretched thin.

An external contractor can provide flexibility in providing the proper staffing level as the project requires. When the job’s done, they’re off the clock. This keeps you from paying for more in-house staff than you need -- sounds a bit like lean manufacturing, doesn’t it?

The right manufacturer can also provide the flexibility you crave for specialized services on an as-needed basis. You can take advantage of a required skill set quickly, with less cost and time investment.

3. Skill

Speaking of skill, your metal manufacturer may be able to provide expertise that’s not available from the in-house staff. A skilled partner will probably already have the necessary equipment on hand, so if you’re lacking in that department contract services are probably the way to go.

Contract manufacturing provides the ability to utilize specialized services as needed, instead of incurring costs on in-house training your workers may not use often.

Most importantly, this expertise will also positively impact the quality of your finished product. You won’t get stuck wasting money on busted or improperly assembled parts.

Of course, if you have engineers skilled with assembly already on your staff, why not take advantage of them and keep things internal? Or, if you want your team to become the best it can be, it may make sense to develop them through assembly training. A more valuable worker is worth money, too: He’ll make your services more desirable to the paying customer.

4. Turnaround Time

In some cases, time is on the side of in-house assembly services. With the in-house method, there’s no transporting parts back and forth and there’s no waiting your turn. And the response time to issues that arise during assembly may be handled more rapidly in-house than at an off-site manufacturer.

Another potential worry: Are you a priority for your potential contracted partner? Since a longer response time equates to more downtime and lost production, it’s important you find contract services that will meet your expectations so money-making opportunities don’t slip through your fingers while you’re idling.

Despite all this, an experienced metal manufacturer that has the entire assembly process down pat can still reduce lead time to market in some instances.

Have You Considered All-in-One?

A fully featured, all-in-one manufacturer may be skilled in not only assembly, but also design, manufacturing, fabrication, and finishing. Taking advantage of all of these services under the same roof is often cost-effective in itself.

Even if you only hire a manufacturer to handle your assembly, its experts may notice a flaw in your design they can help you solve.

If you feel you can trust and relinquish control to an outside partner, contract metal manufacturing assembly services can often save you a bundle of money. And just like that, your company has one less worry on its mind.

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