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Strategic Sourcing and Production Planning

By The MacroFab Team  |  December 12, 2019

When navigating new business activities, your suppliers and partners should be integrated into your strategic planning. This means that your internal sourcing and production planning strategies must align with that of your contract manufacturer (CM) and component suppliers in order to maximize the economic benefit. Without this alignment, the product mix, loading, resource allocation, and overall supply chain could be inadequate to serve your needs. A dedicated strategy for strategic sourcing and planning will compound the efficiency for running your back-end operations that starts with a common platform.

Strategic Sourcing

An internal strategic analysis of your purchasing needs should be able to reveal spending patterns across the business units. The sourcing requirements for each business unit may differ, but do not need to come directly from a wide variety of partners. Instead of going through the RFP process and negotiating with a broad selection of suppliers, you have the option to choose a manufacturing partner that will provide you with a larger pool of vendors to effectively offer you an unlimited virtual factory capacity.

Leverage CMs With Smart Platforms

Purchasers can leverage CMs with smart algorithms to select the best factory for your product, based on its technology requirements, cost targets and delivery objectives, rather than arbitrarily selecting factories based on unutilized capacity or sales quotas alone. Therefore, you only need to work with one team, one software platform and one point of accountability for all of your electronics manufacturing needs. Your order will be routed to the factory that is best suited to meet your specific needs, without spending months re-negotiating each factory contract. ERP tools integrate the progress of suppliers into your incumbent processes and systems. From assembly to turnkey BOM procurement and logistics, you will get the support that you need. This will allow you to track performance and gain visibility into the timeline of your assembly and final product, through our platform and experienced team.

Purchasers can use electronics manufacturing platforms to check on order status in real-time. Tracking has never been so easy. By creating a supplier portfolio for your business in this fashion, you will get the best performance in every facet of your operation, but will not need the breadth of communications across a variety of suppliers to get the job done.

Production Planning

Strategic periodic reviews with sales and marketing must create a high confidence demand profile for you that is driven by your customer needs. A proper forward-looking forecast from this activity will yield the product mix and loading necessary to support your manufacturing over the course of the next 6 – 12 months.

Advantage of Collaborative Tools

Since your specific product mix will drive different raw materials and manufacturing needs, the forecast can match these requirements with the actual resources needed to fulfill the necessary demand. A well-built demand profile can be shared with your CM using collaborative ERP tools to ensure that the decision-makers on the production floor have the resources needed for fulfillment. When gaps in capability are identified, your CM will work with you to plan the expansion of current resources or acquisition of unique equipment as needed by your business.

Your CM will plan the schedule needed to satisfy your demand based on your forecast through the ERP collaboration. You can forecast with greater reliability to meet your metrics and budget by creating purchase orders with confidence. Quotes are delivered with transparent pricing in as little as one to three days. In lieu of the pain and frustration of tracking quotes from a variety of vendors, access a network of 70-plus factory partners with available capacity to get the most competitive prices globally.

Place your order on one central platform and let your CM handle the rest. The logistics team will source your components and can help find alternatives for out of stock or end of life (EOL) parts. Resources can be better aligned and used more effectively when planned through a system that recognizes the entire supply chain, as opposed to only a small piece of the information. Your team can place orders of any size and be sure that they will be produced to high standards and delivered on time. Payment terms can be provided for high-volume orders to qualified customers at globally competitive prices.

Procure to Pay

Without an integrated system, up to seven discrete procurement steps need to happen for each supplier in order to fulfill an order: a requisition must be placed, vendor selection happens, a purchase order is issued, documentation is received at the destination, an invoice for payment is received, reconciliation against a known receipt takes place and finally accounts payable makes a payment. With a customer and supplier system integration to meld the supply chain management, the process is drastically simplified. Reduced costs and increased efficiencies are gained by using collaborative tools between customers and suppliers.

With a collaborative system, lead-times can be reduced and inventory can be planned and forecasted ahead of demand. Delivery time ARO can also be reduced with the procurement steps already planned in advance. The cost of inventory can be reduced with better manufacturing product mix alignment to minimize WIP.

Specifically, MacroFab can manage your bill of materials and system supply chain to receive all of your enclosures and electromechanical components to build your finished product. Our system integration services can help consolidate the procurement requirements for your new product introduction (NPI) and prototyping for custom integration. In addition to piece components within a BOM, we can also help you source unique interconnects, cabling and harnesses. Mechanical assembly, including electromechanical integration and system-level test for volume manufacturing, calls all be tracked within the MacroFab platform.

Consider the ease and benefits of integrating your manufacturing partners into your supply chain tools. Not only will your planning forecast become more transparent, but your negotiations with a large vendor count can now be reduced. MacroFab’s platform reduces the burden on your procurement logistics and allows you to focus on the key differentiators for your company.

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About MacroFab

MacroFab offers comprehensive manufacturing solutions, from your smallest prototyping orders to your largest production needs. Our factory network locations are strategically located across North America, ensuring that we have the flexibility to provide capacity when and where you need it most.

Experience the future of EMS manufacturing with our state-of-the-art technology platform and cutting-edge digital supply chain solutions. At MacroFab, we ensure that your electronics are produced faster, more efficiently, and with fewer logistic problems than ever before.

Take advantage of AI-enabled sourcing opportunities and employ expert teams who are connected through a user-friendly technology platform. Discover how streamlined electronics manufacturing can benefit your business by contacting us today.