Choosing Between an Overseas or Domestic Electronics Manufacturer

January 5 2018

Large Harbor scene with cranes, aircraft, and shipping

You have a decision to make.

Are you going to farm your work to an overseas partner that has this really attractive price or are you going to seek a domestic partner that may cost more but will be easier to work with and deliver higher quality?

That really boils downs to what’s most important to you.

Even though we’ve all been burnt by going with the lower price, we still continue gravitate toward price as the deciding factor when making a purchase. It’s ingrained in our consumer DNA.

We all want to find that diamond in the rough, that golden unicorn, that one company that can provide all the attributes of a domestic electronics manufacturer with the pricing of an overseas company. These are hard to find.

Below we dive into some of the main factors that you will need to consider when making the decision between an overseas vs. a domestic electronics manufacturer.

Timeline

Let’s be honest. Most of the time we are planning out projects, tight timelines are a big factor. Even the projects planned far in advance experience delays that can threaten deadlines.

When you are facing tight timelines, a domestic electronics manufacturing service company is your best option.

One of the biggest issues in dealing with an overseas group is the additional lead time you have to build into your project timelines.

Be prepared to plan for at least an additional 4 weeks or more if there are shipping or customs issues.

Be sure to consider timelines in the event there is an adjustment to the design or replacement parts for defective ones shipped need to be produced.

All these soft costs can have a big impact on the project’s budget.

Quality Standards

While there are some overseas manufacturing companies who adhere to high quality standards, finding the perfect overseas partner is difficult.  The language barrier alone can be a source of confusion. Communication and attention to detail are key to a successful project.

Consider the level of quality you are trying to deliver to your customer. If your business model is structured to handle a higher percentage of parts that fail and accept a higher level of product returns, an overseas partner might be the right fit.

However, be prepared to expect a fallout of 10 – 15%. Many times, parts are often built from the most economical materials by people who may have limited training and/or experience.

Companies looking to produce quality products that live up to customer expectations are going to want to partner with a domestic electronics manufacturing service that has quality standards in place.

These added steps taken to ensure their internal processes are operating at a level that produces the highest quality output is essential

Marketing and Company Image

One practical but vital consideration is how your electronics manufacturing partner’s sourcing aligns with your company’s mission and desired public perception.

Small to mid-sized businesses who pride themselves on delivering quality products and providing a positive company culture might find that domestic sourcing better aligns with their business needs.

A “Made in the USA” stamp could prove to be a valuable marketing tool.

Take this a step further and explore the image of your company from a quality standpoint. Manufacturing products that are void of quality issues will build trust and credibility with your customer base.

Turning out a batch of products that have quality issues will not only cost you money in managing returns but many also tarnish your company image should consumers who purchased defective products take their frustration to online review platforms.

Intellectual Property Protection

Since foreign countries have varying intellectual property laws, you can’t know for sure if your intellectual property is safe.

Domestic electronic contract manufacturers have strict protections on intellectual property. You can take comfort in knowing that your product can’t be copied and mass-produced by a foreign entity that will become a competitor.

Communication

Lastly, communication is essential to delivering a quality product on time and to your exact specifications.

A language barrier can create confusion and delay, and a miscommunication can set your project back by days or even weeks.

Time changes will also make it harder to speak to the lead on your electronic manufacturing project.

A domestic partner, on the other hand, can be a trusted partner that quickly responds to requests and alterations in a timely manner, keeping your project timeline on track.

The Advantage to Overseas Partners

With all this being said, we cannot state that there are no benefits to overseas sourcing. Labor is often cheaper, and some countries have developed incentives to attract companies, like low taxes and less bureaucratic red tape.

For this, however, you’ll run the potential risk of lower quality, bad communication, and intellectual property concerns.

Making the Decision

Your decision between a domestic and overseas electronic manufacturer will be based on your budget, desired public image, timeline, and a myriad of other factors.

With a little research, it’s possible to find a domestic partner that delivers a quality project within your budget, with strict adherence to your company’s deadlines.

Levison Enterprises has been told by multiple clients we are competitively priced to our overseas counterparts and also have all the additional qualities of a trusted domestic partner.

Maybe we are that golden unicorn you are looking for.

Contact us today for a free estimate on your next electronics project.

Tags: Electronic Contract Manufacturing, Efficiency

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