Contract manufacturing

Contract manufacturing

The manufacturing of goods and products by one company under the label or brand of another. Contract manufacturing is a process in which one company outsources part or the entire manufacturing production to another company for such benefits as cost savings, improved quality, increased ROI, reduced safety risks, enhanced business focus, and faster speed.

Industry: Manufacturing

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Contract manufacturing

request for quote (RFQ)

Manufacturing; Contract manufacturing

A document that is prepared by the OEM and submitted to the EMS provider for quotation. It typically includes product specifications and quantities, in addition to an AVL and BOM. The RFQ should also ...

return on invested capital

Manufacturing; Contract manufacturing

An important model (net profit divided by PP&E + inventory + accounts receivable - accounts payable) that can help OEMs determine the cost effectiveness of outsourcing. By decreasing fixed costs, ...

time to market

Manufacturing; Contract manufacturing

The length of time it takes to get a quality product into the marketplace. Faster time to market is a critical business objective for all manufacturers. Companies in every industry are using speed as ...

time to volume

Manufacturing; Contract manufacturing

The length of time it takes to bring a product from prototype or first article to a high-volume production mode.

vendor-managed inventory (VMI)

Manufacturing; Contract manufacturing

A process in which a supplier owns components until they are issued or released to the production line. Usually, VMI is handled by a distributor located within a plant.

volume price agreement (VPA)

Manufacturing; Contract manufacturing

A contract service agreement containing pricing, deliverables and cost reductions based on volume manufacturing.

ball grid array (BGA)

Manufacturing; Contract manufacturing

A leadless surface mount device (SMD). Unlike traditional SMDs, this type of device does not have pin leads, instead it contains solder balls at the bottom of the device which melt and make contact ...