What is contract manufacturing?

Contract manufacturing is a type of outsourcing. A business enters into a formal agreement with a manufacturer to produce components, or the whole product.

In New Zealand, the term contract manufacturing is often used to describe outsource manufacturing of circuit boards and electronic parts. But in recent years the term has expanded to include companies contracting metal fabricators to make repeatable, metal-based products.

These days, a lot of products incorporate fabricated metal components. Specifically, metal is a critical component of machinery and instrumentation.

Why go with a contract manufacturer?

There are a variety of reasons for any business to decide to make use of a contract manufacturer. Obviously, it depends on what the business does and what their requirements are, but some of the most common reasons to seek out a contract manufacturing partner include:

  • A business that’s just starting out – often, new businesses simply don’t have the capacity to produce the items they need on-site. This could be because they don’t yet have qualified staff, or because their start-up costs have eaten up most of their capital.
  • A shortage of resources - metal fabrication requires specialised facilities and qualified staff. If the project a business has in mind is a one-off – or they’r e simply not interested in procuring the necessary equipment or staff – contract manufacturing is a good alternative.
  • Time pressures – it’s often faster to get specific components created by a contract manufacturer and then do the assembly on-site.
  • Development of prototypes – when a new product is in the conception stage, it’s easier to have the prototype created by a contract manufacturer rather than attempting to do it in-house.
  • Entrepreneurial business models – with the depth and sophistication of contract manufacturing services available, some entrepreneurs simply prefer to not manufacture their core product, focussing instead on other aspects (e.g. intellectual property development, sales and marketing, distribution) to grow the business.

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What you’ll get from a partnership with ENI

ENI stands for Excellence and Innovation, and in the field of metal fabrication, that’s been part of ENI Engineering’s name and culture since the company’s inception in 1993. We believe in constantly striving for improvement in what we do best and creating partnerships that are of mutual benefit to all parties, which involves delivering quality product in full and on time.

What to expect when meeting with ENI

In much the same way that you need to do your homework around potential contract manufacturing partners, ENI also has some criteria when it comes to their customer relationships. Expect to be asked questions around:

  • Who you are and what you do. What kind of product are you selling? What’s brought you to the table?
  • Confidence in your own marketing. Do people want what you’re selling, and do they know about it?
  • Why you’re deciding to go with a contract manufacturer. Specifically:
    •  Are you moving from another contract manufacturer, and why?
    • Are there problems with the product? We need to be clear about them so we can decide if we can meet that challenge.
  • A good understanding of what it is you want – often some initial, conceptual drawings are a good idea to have on hand.

 

To discuss your contract manufacturing requirements, or set up a meeting, contact us here.