How To Develop Your Sub-Assembly Outsource Strategy

The velocity of today’s supply chains, compressed product cycles, SKU proliferation and mass customization requirements make it difficult to keep up with production.  Manufacturers are challenged with making optimal use of labor resources and plant space, while managing against consistently changing production demands.  Outsourcing the production or assembly of components—separate from your core manufacturing operations—may be a wise choice to create greater efficiencies.

You may need more robust services such as custom engineering and assembly services for heavy equipment or automotive components which entail fabrication or machining. Or, you may only require light assembly and kitting of consumer goods. Sub-assembly services are commonly supplied as part of other contract logistics services such as warehousing and outbound delivery of assembled components or finished product to your customers on a JIT basis.

Here are elements to consider when developing an outsource sub-assembly strategy:

Lean manufacturing.  The objective of lean manufacturing is to put the right product and quantity in the right place at the right time to achieve perfect work flow. All while minimizing waste and staying flexible and agile. An outsource assembly provider that practices lean manufacturing will provide an assembly project plan which includes an outline of the steps and resources required to assemble your products or components to your exact specification. A sub-assembly provider should also address the required IT to integrate with your technology platform while supporting your production flows and processes.

Just-in-time (JIT) practices. JIT delivery supports lean manufacturing when you receive assembled components or product only as needed, according to your production schedules. Your customers, whether wholesale or retail, likely have their own strict delivery requirements. In order to ensure parts and components are received in a timely manner, your production schedules, and customer delivery requirements may necessitate a sub-assembly provider to locate directly at or nearby your facilities.

Proven savings and efficiencies. Seek an outsource provider who can present a viable assembly project plan which demonstrates the comprehensive savings you receive from their services. For example, outsourced sub-assembly can entail management of one qualified supplier and, in many cases, just one purchase order. This creates greater efficiencies, such as lower inventory carrying costs, improved material flow, labor savings and reduced transportation costs. Other benefits to outsourcing sub-assembly may include improved quality and a greater ability to meet increased customer demand.

In short, seek quality, dependability and cost effectiveness from an outsource provider who also shares as great an interest in your customer’s success as you do.

G&D Integrated, a full-service 3PL provider, provides domestic transportation, freight brokerage, contract logistics and supply chain services to a variety of industries from more than 20 facilities across North America. Our value-added manufacturing and custom engineering services include materials processing, sub-assembly, fabrication, and machining. We can locate in close proximity to our customer’s manufacturing operations and leverage lean manufacturing practices to ensure the highest possible levels of efficiency and cost competitiveness.

About the author: Mark London is VP, Sales & Marketing at G&D Integrated