Supply Chain Management
The process of supply chain is costly and requires professional management. Correct inventory, and supplier management play a crucial role in the success of a product and can reduce expenses significantly.
There are a lot of factors to be considered:
Correct material preparation
For example: the packaging process can add an extra of 0.5$ per unit (depends on the packaging complexity). When producing 10 thousand units that will add 5,000$ to the cost!
- It is very-very! important to have a reliable manufacturing plant (usually in China). It is critical to have a plant that has a proven quality and can be trusted to have a good long-term relationship.
- The production handling will need to take care of all the different aspects:
- How will the material be purchased? turn-key/ assembly only.
- Purchasing long lead items (LLI) in a timely manner.
- Define what is the standard lead time for production.
- What will be the correct electronics assembly quality (SMT CLASS)?
- What is the provided assurance for the quality of the production? (COC/COT).
- Who will pay for shipments of the material to the factory?
- Is there any storage cost? Is there an insurance to the stored material?
- What are the shipment terms? Does the factory provide drop shipment? What will be the charge of shipment paperwork?