Comparative Account: In-house vs. Contract Manufacturing

Electronics contract manufacturing allows small and mid-sized OEMs to make technologically advanced products and build a competitive edge. Contract manufacturing is often compared to in-house manufacturing. This post focuses on differences between these two types of PCB manufacturing.

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Pros and Cons of In-House Manufacturing

The biggest benefit of in-house manufacturing is there is almost no possibility of any discrepancy in the design, manufacturing, or any stage of the entire process. While in-house manufacturing has some advantages, it has a flip side too. Here are some points to consider:

• As mentioned, the biggest drawback of in-house manufacturing for electronics manufacturing and PCBs is that it requires a huge investment to set up a fabrication unit, testing devices, CNC machines, and other advanced machinery.
• It also requires expertise for which you may need to hire experts in the related segments.
• The amount of resources, network, and capital is immense; you need to build a vendor network for part procurement to get the best or required parts on time. For this, you need to have your own logistics and supply chain unit.
• Storage of parts, in-process products, inspected products, and the ones to be shipped is an important aspect. For this, a big enough warehouse with a proper pallet racking system, material handling equipment, and inventory tracking software are essential.
• You need to comply to certain industry standards and policies and may require certifications too. If not done properly, legal implications may apply.

All in all, you need to invest in equipment, technology, human resources, and more. So, while in-house manufacturing seems an attractive idea, it is easier said than done.

Benefits of Contract Manufacturing

Contract manufacturing offers many benefits aside from just cost. Once you have the final product design ready, all you must do is to search and finalize a reliable and experienced PCB contract manufacturing services provider, which solves 50% of the problems associated with in-house manufacturing. Here are some benefits.

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• The contract manufacturer has it all – fabrication unit, assembling unit, warehouse, supply chain, separate units for repairs, and all the other required infrastructure, human resources, and service structure. They will require only your specific, detailed designs to assemble your product. They take care of part procurement, components, materials, actual manufacturing design, inspection, and the entire process as such.
• Here, you may ask them for a prototype, get a design inspected multiple times, make changes if required, and so on. Contract manufacturers assist you at every stage as most of them have skilled and experienced engineers and designers working with them.
• You do not have to pay all at once and can divide it in parts as per the payment structure.
• You get a lot of flexibility, customization options, reduced time to market, and many other additional benefits.
• You get time to focus on your core area of expertise, related research, documentation, and more.

If you are an OEM manufacturing electromechanical or electrical products and do not have an in-house PCB manufacturing and assembling unit or the required expertise, you may need to partner with a reliable and expert contract manufacturing services provider. Aside from PCBA, you may require other services such as box build assemblies, supply chain, repairs and refurbishments, and more. Contract manufacturing services encompass all these services other than PCBA. Suntronic Inc. is an experienced EMS, which offers end-to-end services for PCBA, cable and wire harness assembly, box build assembly, supply chain, repairs, BGA rework, failure analysis, and more.

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