Online Manufacturing Platform Can Offer Best of Both Worlds: Service Bureau AND Supplier Network
Working with a contract manufacturer is a relationship that’s often compared to marriage. In both cases, finding the right match is the key to a happily-ever-after outcome. As with matrimony, experts recommend focusing on compatibility before going down the aisle—make that placing an order—with a manufacturing supplier.
The search for that right match should focus on finding a supplier that’s a good fit with your product and its place in the market. The manufacturing processes, capacity, standards, turnaround time, and cost should meet your needs.
Whether working directly with a manufacturer (service bureau), or using a network of manufacturing suppliers, both offer benefits. And, in the case of Protolabs, we offer an online manufacturing platform that offers the best of both of these worlds—a service bureau AND a global supplier network. This network complements our massive in-house capabilities, and provides customers with infinite manufacturing capacity, a broad range of manufacturing services, and competitive pricing.
Before taking the plunge with a contract manufacturer, you have several options to consider.
You may opt for doing your project in-house. Prototyping or short-run production may work for companies that have internal R&D labs or small shops with desktop or industrial 3D printers, a CNC mill, or an injection molding press. In-house shops, while convenient, may fall short on producing more complex parts, often have limited capacity so they become backlogged, and may have a limited selection of materials.
To overcome those challenges, the ideal partner may be a service bureau, a knowledgeable manufacturing supplier of parts with a full suite of services. The best service bureaus will work with you all the way from design and prototyping to engineering builds and on-demand production over the life of your product—further optimizing your supply chain.
There are also companies—sometimes called brokers—that offer access to an array of manufacturing suppliers, providing a network of manufacturing partners with a broad range of capabilities.
Still another supplier option is using an independent machine shop, which is a smaller manufacturing alternative, typically specializing in a limited number of services. They may run into capacity constraints because of their size or when large customers’ orders take precedence.
Finally, high-volume production houses can also be an option, especially when you need many thousands or millions of parts. Upfront engineering to ensure a smooth run will add cost, however, and they likely will be slower and more expensive for prototyping, short runs, or low-volume production.
Questions to Consider
As you evaluate your options, ask yourself these questions:
- Does the supplier or supplier network have the manufacturing capabilities you need?
- What about the manufacturing speed and capacity to respond to quick-turn orders during product development, market launch, or production phases?
- What about minimum part orders? Many production houses have relatively large minimum part orders, which can be a risky upfront financial investment if only low volumes of parts are initially needed. Look for a manufacturing supplier with no minimum part restrictions.
- Does your supplier have the level of quality control you need? A medical-grade supplier’s quality control should be excellent but that would add expense to a commercial-grade product that may not need an elevated level.
- Does your supplier work with your project’s materials? Look for those manufacturing suppliers that stock with the widest selection of materials on hand and have the most expertise in using them. They often accept most customer-supplied materials as well.
- What about design support? If you’re not a manufacturing expert, advice or feedback on the manufacturability of your project may be in order.
Those are some of the primary considerations that product development consultant Perry Parendo advises keeping in mind when evaluating prospective suppliers. Parendo, founder of Minnesota-based Perry’s Solutions, has experience in the medical, automotive, aerospace, and defense industries.
For corporations, midsized companies, and others with the resources to assess a supplier’s capabilities, Parendo recommends working directly with a service bureau. For other companies, choosing from a network of manufacturing suppliers may be the place to start.
When possible, Parendo said, he prefers taking projects directly to suppliers to streamline communications, avoid the expense of a broker, and maintain greater consistency and control.
Michael Corr, founder of Durolabs, a Los Angeles-based manufacturing consulting firm, said working with a network can make things simpler “if your own Rolodex of suppliers is fairly shallow.” A manufacturing platform that offers a network also can help overcome language and cultural barriers reducing the risk in dealing with overseas suppliers.
“You might lose a day because you have to send engineering notes to the translator and then they have to translate it and send it to a Chinese supplier, and then the reciprocal,” said Corr, whose experience includes working in China with contract manufacturers and suppliers. “But losing a day in order to save, say, three weeks because a part has to be redone because of miscommunication is worth it.”
Whether working directly with a manufacturer or using a network of suppliers, “Manufacturing is all about relationships with suppliers at the technical level and the personal level,” Corr said. “It’s all about what you can do to remove any potential ambiguity or misinterpretation because the risks are too high, too expensive both in time and money.
Here is a closer look at several options for choosing a manufacturing supplier:
1. Service Bureaus (Manufacturers)
Service bureaus have a wide choice of manufacturing technologies, with the best offering a full suite of services such as injection molding, CNC machining, 3D printing, or sheet metal fabrication. In addition, these bureaus often provide online automated quoting, and valuable design-for-manufacturability analysis. Higher-value service bureaus will have the ability to work with you throughout the design and development process as well as the entire life of your product. Service bureaus typically have a deep knowledge of how to make the best use of their processes and materials.
Quality control: Consistency is a strong suit, with available inspection reports and processes to ensure repeatability and reliability.
Turnaround time: Should be extremely responsive, with the ability to respond immediately to your order.
Volume: Varies, depending on capacity. A small service bureau may hold little volume advantage over an internal shop.
Production cost: Varies but may be higher than some internal shops. Service bureaus, however, know the competitive landscape and price accordingly. Prices at larger bureaus fluctuate less than at smaller ones, which tend to drop prices when they need work and raise them when they’re busy.
2. Network of Manufacturing Suppliers
A network can help companies that don’t have the resources to evaluate suppliers. Brokers of these networks have an incentive to find the right fit between their client (manufacturing supplier) and the partner (customer company) in terms of manufacturing capabilities, quality control, or certifications.
Find out a network’s sweet spot and determine whether it aligns with your project.
A network specializing in automotive prototypes, for example, might not be the right choice for your ISO 13485 medical device.
Quality control: Consistency is important and that is available when choosing a network that has thoroughly vetted premium manufacturing suppliers.
Turnaround time: Varies based on the size of the network and the capacity of the suppliers within it. A large, global network can deliver speed on par with service bureaus.
Volume: Also depends on the size of the network.
Production cost: A network’s practice of bidding jobs out may offer savings.
3. Independent Machine Shops
An independent shop is a smaller manufacturing alternative, typically specializing in a limited number of services. They also may run into capacity constraints because of their size or when large customers’ orders take precedence.
These suppliers usually are smaller and more specialized. Some may be good at working with challenging materials like Inconel, but may be more expensive for basic aluminum parts. Machine shops may be among the best at their core expertise but not in others.
Quality control: Ranges across suppliers and usually depends on their niche or expertise. Quality control at machine shop specializing in aerospace or ISO 13485 medical devices should be excellent and should still be good but less formalized at “garage shops.”
Turnaround time: Should be fast and competitive when they have capacity but subject to backups when busy.
Volume: Because they tend to be smaller, machine shops may have capacity constraints. If your project is in the shop’s core service, it should have greater capacity for that than for other jobs.
Production cost: Shops specializing in parts for the aerospace industry, for example, or those working with exotic materials or parts with tight tolerance typically will be more expensive because of the higher-end machines required.
4. High-Volume Production Houses
High-volume production houses, typically focused on injection molding and CNC machining, reduce piece part price when running thousands or millions of parts. Their niche is shaving seconds and pennies off of projects through high-speed repetition, especially when running “lights out” or in a factory that’s fully automated. Upfront engineering expenses may be high. These suppliers typically don’t like doing prototypes because they’re not cost effective at it.
Quality control: Typically very good. Production houses specializing in highly regulated industries usually will meet the required standard. Quality control for commodity-type parts will be at a lower but appropriate level.
Turnaround time: Generally good and predictable for high volumes. Delays may result if the supplier has to acquire equipment to produce your part, which many will do.
Volume: Large orders are their bread and butter. Will dedicate equipment to a project, such as a molding cell that would run parts for years at a time.
Production cost: The higher the volume, the better the cost because of the focus on operating efficiently. If you need just a few dozen or a couple hundred parts, however, they’re more expensive.
5. In-House Production
In-house production offers the prospect of convenience—just walk down the hall to get a part made. A desktop or industrial-grade 3D printer can make a concept model of a product or parts for form and fit testing. An in-house shop with an industrial 3D printer, CNC machine, or molding press can provide engineering-grade parts that are production representatives. That convenience comes at a cost, however, from the upfront capital investment in equipment and acquiring and storing materials to having skilled who can operate the machines effectively. And that convenience is available only when an internal shop has capacity. They regularly partner with service bureaus for quicker, simpler production parts or functional prototypes.
Quality control: Generally very good but likely sporadic in an early R&D shop and better when a part is transitioning to production.
Turnaround time: In-house shops often operate at or near capacity, leading to long lead times that force development teams to outsource to get parts made quickly.
Volume: Typically work in lower volume because of limited capacity and specialization.
Production cost: Larger OEMs often have a friendly cost structure that doesn’t apply costs to individual projects. OEMs and in-house shops can be more expensive when manufacturing parts outside their forte.
Ultimately, you have choices, which is a good thing to know when navigating the search for a manufacturing supplier. As mentioned at the beginning, the search for that right match should focus on finding a supplier that’s a good fit with your product and its place in the market. The manufacturing processes, capacity, standards, turnaround time, and cost should meet your needs. You’ll find benefits in working directly with manufacturers as well as working with a supplier network. And, in some cases, you can find a manufacturing platform that offers both, a network of suppliers that complements a manufacturer’s services and capabilities.