Don’t let a few cents off up front influence your choice of EMS provider; it could cost you time, money and frustration moving forward, says STI Electronics president and CEO, Dave Raby.
When choosing an electronics manufacturing services provider, there are many factors to consider and compare, not least the supplier’s capability. This could take account of the provider’s equipment, supply chain options, staff, process quality certifications, ITAR or security clearances and facility location.
First off, it’s important to ask whether the EMS provider has the right mix of equipment to manufacture the product in question. Is the equipment well maintained and are staff adequately trained? Bear in mind whether there are manufacturing and quality controls in place that meet, or exceed, the design constraints or end-use environment for which the product is intended.
Next, work out whether the EMS provider’s output potential matches your quantity forecast, including potential surge requirements. This is important because every EMS has a certain volume where they function best and your quantity forecasts should hit somewhere near the middle of this. If your requirement is near their maximum capability, growth will be difficult. If your forecasts are near the bottom of their capability, you may be neglected and not receive optimum service. Site visits are crucial to establishing capability, as are customer references for similar sized projects.
Supply chain options and control are another important factor. As counterfeit components continue to be a problem, it’s essential to work with qualified suppliers who can source the product you need, when you need it, in adequate quantities, at a competitive price. Supply chain management is therefore a must in today’s global markets.
When it comes to staffing, it’s wise to consider your product mix and requirements. Take a look at the percentage of managers, engineers and skilled labor and assess what staff support your project will require. For example, if your product must be built or inspected to a particular standard or specification, does the EMS staff training and certification meet this requirement?
Facility requirements go hand in hand with staffing, particularly if you need a facility that is ITAR certified or has a secured facility rating. Do you, for instance, require a provider that is AS9100 registered, or is on the qualified manufacturers list for J-STD-001 or IPC-A-610?
Location can also be an important deciding factor, particularly if source inspection is a required part of your process. The ability to drop in and watch your product being manufactured can provide peace of mind and distance will certainly add to the cost when your team has to make one or more visits. Calculate the total cost of a couple of trips to various suppliers to see how this affects your overall product cost.
Obviously, price is always key, so be sure to consider the entire cost, including things like travel, shipping and returns. Suppliers producing high quality or high reliability products may cost a little more up front, but will save many headaches and dollars in the long run. Bear in mind that manufacturing quotes alone do not always represent the complete picture of investment.
Using this knowledge, look at your potential supplier’s financial stability. There are several commercial sources for looking at a company’s credit worthiness. EMS providers should be able to supply three years of financial data and this information must give you confidence that they will still be around when your product is going to be delivered. EMS businesses are constantly watching cash flow and many times it is at its worst when they are buying your inventory.
Depending on the product, traceability might be an issue. Some relatively low end products don’t require any traceability, but as complexity and costs increase, it can become critical. If a fix is needed after a product has shipped, for example, it’s better to recall all the product built with a particular reel of parts, as opposed to all the product built in 2016. Any potential EMS provider should be able to explain the level of information they collect and store, how it can be accessed, and its security.
As with traceability, testing may, or may not, be a requirement for your product. This could involve a simple flying probe test, or perhaps you provide a test box, or it may be more complex whereby EMS engineers develop and implement testing for your product. If this is the case, don’t let your product be the first for which they offer this service.
Finally, assuming the job is turn-key, make sure the potential provider has experience and processes for identifying, purchasing, and monitoring your inventory. Understand how they do this and how your inventory is identified and separated from others if necessary.
It’s a lot to take on board, but considering these factors when choosing an EMS provider is important because you are selecting a partner for your product. Don’t let one factor, like a few cents cheaper up front, make you choose a supplier that will cost you time, money, and frustration going forward.