Here we’ve offered a few observations of manufacturing and the manufacturing industry, and Product Resources’ role as a contract manufacturer.
What is Manufacturing?
Manufacturing means different things to different people. Manufacturing may be easy to visualize, but not to define precisely – “I’ll know it when I see it.” is a likely comment.
Manufacturing is important to governments, and they have struggled for centuries to develop a definition to allow them to distinguish manufacturing companies from other industries especially when attempting to develop policy. Read this article from NIST.gov.
Ask yourself “Is a fast-food restaurant manufacturing or service?” Check out this article from Slate.com.
In general, manufacturing is considered an industry where raw materials or components are processed to produce a more refined or higher value product. Usually this refers to a company that uses mass production techniques rather than single piece production using artisans or “smiths.”
Mass production is a term that refers to a process that uses many workers with a division of labor in the building of the product. This allows for specialization among the workers that keeps costs low and improves consistency in the manufacturing. No single worker needs to be an expert at wiring, soldering, assembly, machining, and calibration.
This specialization also allows for outsourcing of different types of manufacturing (e.g., PCB assembly, precision machining, plastics molding, sheet metal fabrication, plating) to companies with the specialized skills and capital equipment. The advantage is that specialized companies can afford to invest in high quality and high capability capital equipment because they are doing work with multiple companies and therefore have the economies of scale that are important to keep overall cost-per-product low.
Although there is value in “vertical integration” – one company that can make everything they need (even fasteners!) – it can only work if each of their sub-specialties (such as turning threaded parts or plating) is efficient enough to compete against specialized ventures. Those companies exist, but they are typically manufacturing very high quantities of components for other manufacturers. Many companies exist in between Vertical Integration and 100% outsourcing where they make the “clever” part of the product and outsource the mundane.
Product Resources is a manufacturing company that leans heavily on our suppliers for specialty manufacturing like PCB assembly, precision machining, sheet metal fabrication, and plastics molding. We specialize in complex instruments and products that require tight process controls, high quality, high mix, and quantities from 10 to 10,000 per year.
Our engineering department works with our customers on Design-for-Manufacturing to make the production efficient and handles the manufacturing process design and validation as well as alpha and beta prototype builds. Product Resources also has complete product development services and can help bring your product from prototype to manufacturing.