THE CONDUIT

Why Outsourcing Your Cable Assemblies Makes Sense

Posted by Rod Van Rite on January 31, 2018

Cables 875x450

If you’re in the business of building and selling heavy duty equipment like emergency response vehicles and asphalt pavers, you know how hard it is to perfect everything that goes into the design, manufacture, and sales of these machines.

Especially in the design and manufacturing stage, there are thousands of parts and components that will need to be designed, built, and assembled for your equipment, and today it’s rare for OEMs to take on all of those production responsibilities in-house. That’s why outsourcing more difficult components, like cable assemblies, often just makes more sense for OEMs, due to its efficiency. Outsourcing allows an organization to focus on the areas it truly specializes in, and can help OEMs overcome these four challenges:

Equipment and Technology

Even if you try to position your organization ahead of the curve, researching and investing in the latest technology for every component in your equipment can be daunting, not to mention unlikely to be in-budget. For example, if your cable assemblies require precise lengths or specialty applications, the most cost-effective way to process them is with automated cutting and crimping machines. The automation helps reduce, if not eliminate, rework and wasted materials, but it’s also a significant investment for OEMs. Likewise, when it comes to testing, you’ll want to be sure the technology is up to date to ensure your cable assembly will truly function as designed. Or, you could just let an assembly partner worry about keeping up with technology and investing in the best equipment.

Skilled Labor

The U.S. is currently experiencing a shortage of skilled laborers – and it’s only going to get worse. Over the next decade, the Manufacturing Institute estimates more than 3 million manufacturing jobs will open up and 2 million of them will go unfilled. For an OEM, that means it will likely be very difficult to find workers with the specialized skills to design and build cable assemblies. Instead of taking on that recruitment challenge, an assembly partner that already has a team of qualified staff can provide high-quality solutions for you.

Inventory Management

Material handlers in many OEM facilities spend a considerable amount of time tracking, picking and distributing parts. And if you’re building cable assemblies in-house, that amount of material increases, along with the potential for errors, excess, or obsolete parts. When you partner with a cable assembly supplier, they will be responsible for keeping track of extra parts and inventory, and all you handle is the finished assembly.

Risk Control

When OEMs produce cable assemblies, they take on the risk of issues that could occur, like faulty displays or decals, incorrect routing, improper power supply, and more. Not only do these issues cost money to fix, they can leave your engineers and designers scrambling to identify and rectify the problems. By outsourcing your cable assembly, you can mitigate that risk, because if there are issues, the supplier will be held responsible. A good supplier, however, will conduct testing throughout production and guarantee the final product.

Getting your product to market quickly can make you an innovator in your industry. If your facility is not equipped with the space, equipment, or skilled workers, however, building cable assemblies in-house will inevitably take longer and cost more. While it may seem more expensive upfront to outsource, calculating the total landed cost of your product can help you decide which route to go. We’ve also created an infographic, To Build or Not to Build? Outsourcing vs. In-house, to help you make an informed decision. Click the button below to download your free copy.

The Benefits of Outsourced vs. In-house Assemblies

Topics: Contract Assembly, Electrical Assemblies, Manufacturing/Operations


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