At times, the number of new projects slated to be brought in-house puts OEMs at odds with capacity. Perhaps the physical limitations of the manufacturing facility or a lack of specialized equipment inhibits production. Or, there simply aren’t enough workers — or workers with specific, required knowledge — to meet demand.
To resolve the conflict, OEMs have several options. They can delay projects, stretch their resources and staff so thin that focus on core competencies and quality is compromised, or enlist the help of a contract manufacturer (CM).
The last choice is obviously the most practical, yet there is typically some hesitation on the part of OEMs. Their beliefs or experience may have led them to understand that using a CM means:
The concerns may be legitimate in some instances, but they may also be a bit shortsighted.
Overlooking the value-add of experienced CMs is detrimental to OEMs facing capacity issues. CMs that operate as virtual extensions of an OEM’s operation — such as GMI Solutions — offer unique benefits.
GMI’s assembly-level expertise and willingness to foster a synergistic relationship with the OEM’s team alone debunk many popularly held opinions about CMs, but there’s so much more. Top-tier CMs draw from a wealth of knowledge to enrich the OEM-CM partnership beyond resolving capacity issues. From it, OEMs gain:
The value of the relationship grows as trust builds and the CM assumes more responsibility in alleviating OEM capacity overages, providing:
When a large manufacturer of optoelectronics systems was faced with urgently incorporating the production of a corneal topography system into their already crowded operation, they turned to GMI Solutions for help. Immediacy of the need was the biggest risk this OEM faced, and they knew that GMI was nimble enough to accommodate the extremely tight timelines.
GMI accepted the existing inventory on the OEM’s shelves, assumed open orders with existing suppliers, and even transferred some items to GMI’s direct supply chain. Prototypes were then assembled, tested, and sent through the OEM’s FAI process. Plus, since GMI was able to readily accommodate the product requirements for quality and consistency, the product was in production within a few weeks. This allowed the OEM flexibility on their factory floor without the need for hiring, building expansion, or significant engineering resources.
Resolving capacity issues is just one of many solutions offered by CMs, provided OEMs give careful consideration to the partnership alignment. Reach out to GMI to discuss how we can help you maximize production and profitability, and read more about the benefits of aligning with a true contract manufacturing partner in Outsourcing: The OEM’s Guide to Selecting Contract Manufacturers. Click the button below for your copy.