This article was published on May 18, 2021 and updated on February 16, 2023
Many types of companies have a need to assemble their products, whether a manufacturer that requires the assembly of components for further manufacturing processes or a retailer that must assemble products to make themselves ready for display. Companies that require product assembly must either perform these services in-house or outsource to a contract assembly provider. Outsourcing can be very beneficial to companies, although they should be aware of the advantages and disadvantages of contract assembly.
Advantages of Contract Assembly
Companies that utilize the services of a contract assembly provider can realize many benefits that can improve productivity and increase profitability. Some of the ways in which companies realize advantages with contract assembly include increased internal capacity, which allows the company to focus on their niche manufacturing market, budget control, improved quality and delivery, and insight from an experienced assembly provider.
Increased internal capacity – companies that require assembly of products must dedicate floor space and labor to perform in the assembly process. By outsourcing this process to an assembly provider, companies free up internal resources with increased capacity.
Savings on labor and benefits – by outsourcing contract assembly, companies do not need to hire and train individuals to perform these processes, which saves on labor expenses as well as benefits and continual training with employee turnover.
More resources to focus on niche production – freeing up floorspace and labor by outsourcing assembly allows a company to focus on its niche manufacturing market or products.
Increased productivity – companies that receive assembled products on time can improve their own productivity by producing more products internally and increasing sales revenue.
Improved profitability – with a reputable contract assembly provider, companies can increase productivity and profitability with budget control and assurances of receiving quality products on time.
Improved quality and delivery – companies that are having a hard time meeting in-house assembly demands can improve their delivery by receiving assembled products on time. Working with an experienced assembly provider can improve quality when working with a quality-minded assembly house, particularly one that is certified to ISO9001:2015 and practices quality policies.
Insight gained from experienced assembly providers – experienced assembly providers can offer insight into the most efficient assembly methods and offer suggestions to manufacturers to improve the quality and delivery of assembled products.
These are some of the advantages of working with an experienced and quality-focused contract assembly provider.
Disadvantages of Contract Assembly
Companies seeking the services of a contract assembly provider should ensure that this provider has the experience and ask to see their quality policies and performance, including customer satisfaction and on-time delivery history. When working with an experienced, quality provider, there are not many disadvantages of contract assembly. Some issues that could arise with an inexperienced provider may include communication errors, less control over the entire project, intellectual property risks, and quality and delivery issues.
Communication errors – outsourcing to a third party could create communication errors if either party does not clearly relay assembly or quality requirements or issues that may arise. Make sure your assembly provider is responsive to your needs and specifications.
Less control over the entire project – using the services of a contract assembly provider means trusting the provider and having less control in-house over the process. Working with an assembly provider that has a track record of delivering quality assembled products can ease any concerns over losing complete control of a project. Make sure that a work process is developed with quality checks as required to meet your specifications, including any critical dimension checks and quality audit requirements.
Intellectual property risks – companies that must assemble proprietary products or government projects must ensure the safety of intellectual property. A trustworthy and reliable assembly provider will sign nondisclosure agreements and ensure the protection of intellectual property.
Peoria Production Solutions, PPS, is a reliable and quality-focused contract assembly provider with more than 80 years of experience. We provide clear communication, work processes, and quality checks that align with our ISO9001:2015 certification and internal quality processes. You can have confidence in our experience, quality procedures, and highly trained staff to deliver contract assembly products on time and to your specifications.