Singapore's holistic approach benefits both contract manufacturers and OEMs

摘要

Reducing cost without compromising quality is a challenge for both contract manufacturers and original equipment manufacturers. Classic strategies for reducing cost, such as moving to lowest cost labor markets or using aggressive bidding practices, can reduce cost in high volume consumer projects but may be far less effective in complex, lower volume or variable demand projects. Issues such as logistics costs, alignment of deliveries with demand, supply base breadth and maturity, automation practices and workforce skill levels can all drive cost surprises in more complex projects. In this realm, lowest total cost is achieved through careful analysis of more than regional labor cost or unit price. Singapore's use of consortia to both strengthen supply base infrastructure and reduce OEM sourcing and market entry costs represents a unique approach in this area. This article discusses the mechanics of this approach and its relevance to electronics manufacturing services (EMS) providers and electromechanical contract manufacturing participants.