Posted on 24 Aug, 2017 by Neil Sharp
With around 250 Electronics Manufacturing Services (EMS) providers in the UK alone, finding the right supplier for your business can, at times, feel a little daunting.
If you have already outsourced part or all of your manufacturing operation then you'll already have a good understanding of what’s expected.
But that doesn’t mean transferring your business to someone else again is going to be easy. In fact, if you’re looking to move EMS provider then chances are something didn’t go according to plan the first time. Which probably means you have more questions and concerns this time around.
To avoid making the same mistake twice, or if you are considering outsourcing for the very first time, here are 6 points we recommend you consider to help find the right assembly partner for you.
If you’re looking for a provider to supply printed circuit board assemblies (PCBAs) then your luck is in. The majority of UK EMS providers out there will have several pick and place machines at your disposal. But what does this PCBA fit into? A plastic enclosure? A metal box? Or does it form part of amuch larger machine or cabinet?
When researching potential suppliers it’s wise to think about what the ‘end game’ looks like. How much of your product or manufacturing operation do you plan to outsource in order to achieve your objectives?
Although the PCBA element shouldn’t be an issue, finding a suitable provider to take things to the next level and deliver back a completed unit or machine may narrow down your options. So, it’s often best to look for partners that can offer a complete range of outsourcing services from day one even if you don’t plan to use them all straight away.
Location, location, location
In theory, the location of your EMS provider’s factory is irrelevant. It’s possible to ship goods around the UK on a same day delivery service and into most parts of Europe the next. Clearly, if your target market is further afield, the number of days it takes to receive product increases, so that’s your next consideration. What are the delivery expectations of my market and how close do I need the factory to be in order to meet their demand and service expectations?
The next question, and one that can be easily overlooked during the decision making process, is
how often will I need or want to visit my EMS partner? In the early stages of any outsourcing relationship it’s common for the OEM and EMS provider to be in regular contact. Members of your engineering team may even be required to assist with setting up a test rig or providing technical support during the New Product Introduction (NPI) process. A couple of hours each way in a car is usually not an issue, but much longer than this and it can start wiping out staff for days at a time which isn’t ideal.
Size and shape
I’m sure you’ve heard the old saying that turnover is vanity, profit is sanity and that cold hard cash is reality. Whilst this rings true, turnover does give you an indication of the size of the EMS and more importantly, where you sit within their organisation as a potential customer. A common misconception is that OEMs need to partner with one of the ‘big’ providers (i.e. a Tier 1) in order to receive the very best service and the most innovative solutions. In truth, unless the OEM has plans to spend ‘big’ (and we are talking tens, if not hundreds of millions of pounds or dollars) they are likely to receive the opposite from a Tier 1. In contrast, if you have the potential to take the number one customer spot with your first order there is a risk you are going to be too big for the EMS provider to properly support. Ideally you’re looking for EMS providers that have a good mix of customers across multiple market sectors with varying spend levels.
In terms of physical footprint and floor space you’ll want a provider that has the flexibility to
grow with you in the future. Can you visualise your product being built in their factory or are you struggling to spot empty floor space? Take square footage with a pinch of salt. It’s irrelevant if it’s
already taken up by other customers. And unless your products or machine is immense in size, you
only need to worry about a small part of the available number.
Age and experience
Similar to turnover, the length of time an EMS provider has been in business should be approached with caution. Rather than focus on how long ago the supplier established themselves, it’s more relevant to look at what they have achieved during this time. For example, have they grown consistently? Have their services and capabilities evolved? Have they invested in new people, skills and equipment? Or have they stagnated showing little or no growth over several years?
Supply chain management
Without a stable supply chain in place, backed up by financial strength and stability, there is a concern your outsourcing project could fail. When researching supply partners, this is an area that should be scrutinised in great detail. How broad is the ‘mix’ of materials being managed by the EMS? How many people are dedicated to material procurement and supply chain activities in the company? How thorough is their supplier approval process? Do they have one documented? What kind of spending power do they have out in the market and are you able to benefit from this? How do they manage risk? How do they protect their customers from disruptions within the supply chain or the threat from of counterfeit components? Finally, do they have the skills and equipment in-house to mitigate you from these risks?
The last consideration comes from the gut and you will often know straight away whether or not the supplier feels like the right fit for you. Can you see yourself working with this company and their management? Do you get the impression the sales staff understand your outsourcing requirement? And importantly, do you trust them to put a suitable solution in place? No matter how thorough your supplier selection process is, or how long you have been researching potential partners, your gut feeling is often the most influential factor when it comes to making a final decision.
Hopefully this blog post has helped in some way, even if it may have thrown up several more questions for you to consider. The good news is you’ve already made the decision to outsource, so that’s one huge step forward, now you just need to find the perfect partner to turn your outsourcing dreams into a reality.
Image bySam Rayner