So you want to Manufacture in China...

I had the great fortune of being asked by the MakeInLA accelerator to come give a talk about the nuances of manufacturing in China. Having worked and lived over there, I definitely have some great first hand experience, and plenty of stories to share...

Putting together this presentation was a lot of fun, as it allowed me to formulate many of the principles I try to follow and advise others to do when selecting a CM. These guidelines apply to any CM, not just those in China. With that in mind, I opened up the focus of the presentation to try to generalize the process for selecting a contract manufacturer anywhere in the world.

The major points I tried to hit home were about finding a CM that was a right match for your product market and forecasted volume.

Just about any CM can do PCB Assembly, Box build, and testing, but you need to find a manufacturer that has worked with products similar to yours. This will go a long way in terms of efficiency and costs when bringing up the new product line and for on going support. A CM with experience building products like yours will have valuable a posteriori knowledge of what tools and what skills will be required - and will likely have them already, so you won't have to cover the costs to procure them. Likewise, a CM with engineers who have appropriate experience will be much quicker to identify any problems with the design of your product or during production - and therefore much quicker to resolve them.

The other key point I stressed is about being honest with a CM on your projected volumes. Contract Manufacturers are categorized into Tier 1, 2, or 3 - based on their manufacturing capacity. It's very tempting to try to attract Tier 1 suppliers because of the prestige of working with them and the wealth or resources they can provide. But, if your product can't reach the high volumes they are used to, you will find the relationship will go sour quickly and you will stop receiving the necessary attention you require. In some cases, CM's may even try to make up for lost revenue due to lower production volumes, by passing on more fees to you.

I also discuss the importance of the site audit and what to look for when you are given the factory tour. Pay attention to many of the details on the assembly line floor. This is where your gut instincts will kick in if this manufacture meets your requirements for best business practices and will be someone you want to work with for a while.

Working with a CM is a lot like getting married. You will be working closely together for quite a while, and it's important to do your due diligence to make sure it's a partner you're compatible with. Your product is your lifeline to revenue and therefor success. Don't trust it with just any supplier.

I encourage you to get a copy of the presentation slides or watch a recording of the webinar and feel free to reach out with any questions or comment with your own advice for evaluating and selecting manufacturers.