Michael Corr, Founder and CEO, Duro

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

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. Watch the presentation here.

Tips for finding the right contract manufacturer

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.

Find a manufacturer that has worked with products like yours

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 from a Chinese contract manufacturing company 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.

Be transparent about your projected volumes

The other key point I stressed is about being honest with a CM on your projected volumes for Chinese product manufacturing. Contract Manufacturers for product development in China are categorized into Tier 1, 2, or 3 – based on their product contract 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’re used to, you will find the relationship will go sour quickly and you will stop receiving the necessary attention you require. In some cases, CMs may even try to make up for lost revenue due to lower production volumes, by passing on more fees to you.

Carry out due diligence

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 manufacturer 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 watch a recording of the webinar on YouTube. Feel free to reach out with any questions or comments with your own advice for evaluating and selecting manufacturers.