What is On-Demand Manufacturing & Why Should You Care?
Over the last few years, there has been a shift in the way new products are brought to market. Crowdfunding sites like Kickstarter have connected inventors with buyers and opened the door for new ideas to come to fruition without the involvement of major corporations. This new approach to innovation has fueled the need for a better production option for individuals and small businesses: On-demand Manufacturing.
What is On-Demand Manufacturing?
Before defining on-demand manufacturing, it’s helpful to describe the traditional manufacturing process that it replaces. Until recently, product developers had to try to navigate a manufacturing system that was developed to support the needs of gigantic businesses. In this model, quotes are done by email or over the phone, most manufacturers are located overseas, there are enormous minimum quantities (or expensive penalties for small orders), and lead times are long.
By contrast, on-demand manufacturing, sometimes called cloud manufacturing, is a new business model that makes it possible for vendors to provide support for the production of electronic devices all the way from the initial concept through final product delivery to the customer. This is achieved using a cloud-based software platform that makes it easy for developers to get instant quotes, manage projects, and track inventory from any browser, anytime.
Vendors that offer on-demand manufacturing can leverage that same technology platform to package many small orders together, keeping costs down for everyone and eliminating the need for minimum order quantities.
Why is On-Demand Manufacturing Advantageous?
There are a number of benefits to the on-demand approach for both PCBs (printed circuit boards) and fully assembled electronic devices.
Instant Quotes and Easy Cost Modeling
With a modern online application for quoting and project administration, designers simply upload their design files and Bill of Materials to get an instant quote. To help designers decide how much to charge for their product or how much investment capital will be needed, these online tools let users see what parts and manufacturing will cost at higher quantities.
Traditional manufacturers either reject prototype orders or charge an arm and a leg to do them. One of the main purposes of on-demand services is to take the pain out of prototyping, making it affordable and easy for inventors to rapidly create PCB prototypes and iterate as often as they like.
Sourcing and Parts Inventory Management Included
Your manufacturing partner can take care of the ordering, inventory management, and sourcing for all the parts needed for your PCB. They can also accept your inbound shipment of other items and manage that inventory for you. It can all be easily tracked in the online software application.
No Minimum Order Requirements
Whether you need one PCB prototype or 10,000 fully assembled electronic devices, on-demand manufacturers can meet your needs quickly and inexpensively. This makes it easy to stick with one provider as your business grows and your needs change.
Product Inventory Management
The best on-demand manufacturing companies support you all the way through the product lifecycle by acting as the warehouse and inventory management service for your finished electronic devices. This eliminates the costs, time, and risk of shipping between the manufacturer and the warehouse.
Order Fulfillment and Shipping
Shipping a purchased item to the customer is the final step in the product lifecycle, and on-demand manufacturers can take care of it for you as well. They will provide an API to integrate your ERP or e-commerce solution with the vendor’s platform to ensure that as soon as a customer places an order, it is packaged and sent on its way. Getting this task off your plate is an obvious benefit and saving yourself money on shipping by leveraging the manufacturer’s relationships with freight carriers is another.
On-demand manufacturing is ideal for small businesses, entrepreneurs, Kickstarter creators, engineers, and even makers and hobbyists. It makes it possible for people from all walks of life to create innovative new products or to simply see their ideas become a reality.
In the same way that the Internet has changed how we connect with friends and family, how we consume entertainment, how we shop, and how we work, it is now changing how the products we love end up in our hands.