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Posted on Outsourcing Woodwork

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DS

3231 posts in 2871 days


#1 posted 07-24-2018 03:31 PM

Just a note to anyone expanding from basic product manufacturing into more volume work; Don’t ignore outsourcing.

Outsourcing gives you access to machinery and floor space that you wouldn’t be able to capitalize on for years and vastly expands your capacity.

Usually, a product will have more than one profit center on its way to the consumer. e.g. Sales commission, design profits(royalties), raw materials profit, manufacturing profit, distribution profits, etc.

If your product can withstand the burden of those layers of cost, then YOU can afford to relinquish some of those profits to outsourced vendors in the interest of scaling from your garage to mainstream production.

If you haven’t figured some of those costs into your pricing structure, your product likely will not scale up to larger production volumes.

So, outsourcing 1) helps a small guy scale up production without a large capital expenditure, 2) often improves quality and process control, 3) works out large scale production issues in preparation for dedicated manufacturing lines, and 4) often costs LESS than doing it yourself.

There is VERY little downside to outsourcing.

-- "Hard work is not defined by the difficulty of the task as much as a person's desire to perform it.", DS251


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