OEMs are always under pressure to reduce production costs and streamline operations. One of the solutions many companies are turning to is outsourcing, or contract manufacturing as it is often called. Contract manufacturing is when an OEM outsources part of, or the entire, manufacturing process to an experienced third party, like RiverSide Integrated Solutions (RIS).

Contract manufacturing has been around for decades, and many industries rely heavily on outsourcing to remain competitive. While all supply chain processes can be outsourced, many OEMs are looking at product assembly as an area of opportunity. Complex assemblies can involve hundreds, or even thousands, of parts and consume a huge amount of a company’s time. Outsourcing assembly saves OEMs time, money, and resources – giving an invaluable competitive advantage!

Benefits of Contract Assembly

There are many factors to consider when deciding if contract assembly is right for your business. To help you make the decision, below are the key benefits of outsourcing product assembly to a trusted partner. All of the advantages below result in supply chain efficiencies, leading to significant cost savings for OEMs.

• Increase Flexibility: outsourcing yields a level of flexibility for OEMs that is not possible in-house. OEM’s production schedules are tight and do not leave much room for shifting runs to accommodate new or changed orders. Contract manufacturers are much more nimble and able to readily slot in additional orders. This flexibility is crucial to OEMs wishing to capitalize on market conditions to grow their business and improve customer satisfaction.
• Leverage Expertise: this is one of the benefits of contract assembly that is often overlooked. Partnering with a third party will provide your team with invaluable insights, which could extend beyond product assembly processes. Contract manufacturers work with a wide range of industries and products – accruing years of beneficial knowledge and expertise! Leveraging a contract manufacturer’s experience often results in product design improvements and creative solutions for the OEM that only materialize through a partnership.
• Improve Quality: over time, assemblies have continued to increase in complexity. In many cases, sub-assemblies require intricate builds with specialized equipment that demand skilled technicians. Many OEMs simply do not have the in-house equipment and skill sets required to complete intricate, high-quality assemblies. For this reason, outsourcing assemblies to a third party makes good business sense. Contract manufacturers have the necessary tools and skilled workforce to complete complex assemblies, often times at a higher level of quality than the OEM. Additionally, contract manufacturers are experience in a broad range of product inspection and testing duties and often assume these responsibilities as well. When outsourcing assembly, you can rest assured the assembly will arrive on-time and be fully functional. If this is not happening, then you have not found the right contract manufacturer!
• Save Time: contract manufacturers are typically able to complete assemblies faster than the OEM – providing OEMs with more rapid deliveries and increased speed to market. When outsourcing, OEMs are no longer limited by in-house equipment or number of personnel, and are able to operate in parallel with their contract manufacturer. For example, when a sub-assembly is outsourced, the OEM can work on other aspects of the final build while the contract manufacturer is completing the sub-assembly, reducing the overall time required for the final production build.
• Simplify Purchasing and Inventory Management: when dealing with thousands of individual parts, purchasing and inventory management can be a nightmare! Your purchasing resources must place and track orders, confirm parts are stored appropriately, and ensure parts are available on the production line when needed – if all of these steps do not occur seamlessly, there are production inefficiencies resulting in higher costs and longer time to market. The good news is that contract manufacturers handle all of these tasks for you. Outsourcing product assembly reduces the time your team spends on purchasing and inventory oversight and frees these resources for more value-added work that will give you a competitive edge. Additionally, outsourcing assembly reduces the overall labor and overhead personnel required as well as the inventory storage and warehousing space – providing huge cost savings for OEMs.

RiverSide Integrated Solutions’ Assembly Expertise

RIS is an advanced contract manufacturer providing robust solutions in circuit board assembly, product assembly, kitting, supply chain management, fulfillment, distribution, and reverse logistics. We employ more than 300 people and provide services to OEM’s across the world. We operate 3 state-of-the-art manufacturing facilities within the U.S, and as your one-stop-shop we have the capabilities, capacity, quality assurance standards, and resources to provide you with support for all of your manufacturing needs.

Our full and sub-assembly capabilities include mechanical, electromechanical, electronic, and hydroelectric assemblies. We provide solutions that include building sub-assemblies that are delivered to factories across the world to building products start-to-finish. Some customers utilize our full contract manufacturing capabilities and have us become their production facility to assemble, test, package and distribute full products or complete box builds. From purely mechanical builds to the most complex systems with specialized circuit boards and internal communication programs, we provide full system integration for customers across multiple industries.

Contact us today at (507) 523-3220 to see how we can help with your assembly needs, or click here for a quote.