Businesses often wonder if it's more profitable to buy a low volume of components to manufacture their own new product or to buy a high volume of components. The answer is not always clear-cut and depends on a variety of factors. In this article, we will explore some of the things you need to consider when making this decision.
It was a typical Tuesday morning in the office. As I sat down to start working on my new product, I took out my laptop and started making some sketches of what it might look like. But before long, the little red light of devilish temptation had me inadvertently clicking over to the next best thing online, eBay. And there it was in its glory: a fully-assembled version of my new product just waiting for me to click 'buy'.
I'll admit that buying this particular component instead of building it myself would save me time, money and all the hassle of trying to get my prototype just right. But am I really saving any money and more importantly, is this the best option for my business?
What's the difference between buying a low volume of components and buying an assembled product?
The short answer is, of course, it depends. But we'll get to that in a minute. First, let's have a look at what happens when you buy a low volume of components instead of an assembled product.
When you buy a low volume of components to build your own new product, it's possible that some or all those parts will be different from the ones used in the final, assembled version. If this is the case, you could run into issues with compatibility and have to test your new product for compatibility before you sell it to your customers. Compatibility issues could also mean that the final version of your product won't work with other items people already have in their homes or workplaces.
So how do I overcome that while I'm still designing the product?
Rapid prototyping. By iterating quickly, you can test components and final products to make sure they're compatible before committing to buying or using them in your new product.
This will ensure you get the right components for your final product.
Another issue to be wary of when buying low quantities of components is that they might not be available in the future. If you haven't sourced them yet, it may not be possible or practical to find similar products their availability changes or they become obsolete. Be careful about locking out future options.
The next thing to think about if you're thinking of buying components in low volume is the individual supplier or manufacturer. If they are unable or unwilling to provide you with quality components, your product may not function properly and could even be dangerous.
That's no good for anyone.
Okay, so I need to make sure that the components I purchase are compatible with my product and made by someone who knows how to produce them. That sounds like a lot of work.
Not necessarily. 3D printing means you can test components very quickly, see how they fit with your design and make modifications on the spot if something seems to be wrong.
With low volumes of components, it's also possible that you could end up with some spare parts left over at the end of the manufacturing process. This sounds great but it could also mean that the components you originally bought to build your new product have been sitting around for a while and may not be in perfect condition when you use them.
3D printing allows you to design your product so that the components are produced 'on-demand' as people need them.
While rapid prototyping might be an option if you're creating a new product in very low volumes, there's also the option of assessing suppliers before committing to buying or assembling anything in bulk to make sure they can produce components accurately to the right specification.
This should help you make sure you get the best components possible for your new product. But if 3D printing isn't an option, it's also important to assess manufacturing facilities before committing to using them to ensure quality control and the ability to meet deadlines.
It's all about putting a little bit of work in upfront to make sure you get the best components for your new product and avoid wasting time on mistakes later.