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Contract Manufacturing Types

Contract manufacturing refers to the outsourcing of some or all of a company’s actual manufacturing processes to a subcontractor. Manufacturing services include manufacturing the product to the required specifications, engineering the product and designing and building the product.

The most common types of contract manufacturing services include the medical contract manufacturing services, pharmaceutical manufacturing services, electronic manufacturing services, and the contract manufacturing agencies. Any company that wishes to outsource some of their activities can either contact the subcontractor directly or go through an agency.

The electronic manufacturing services are commonly outsourced by the original equipment manufacturer. Basically, an OEM is the original designer and manufacturer of a particular product. With the growth of the company, the maknufacturing component of the business may take a secondary role to marketing, or research and development. With emphasis on the core areas of a business, a company may realize that a contract manufacturer can create the product for less cost than when done in-house.

Electronic Contract Manufacturing Services: These are the most popular contract manufacturing services and range from printed circuit board design to end life management. An Original equipment manufacturer can choose to outsource only specific product manufacturing or use additional services of various subcontractors to help in the distribution. No matter the type of contract manufacturing services that the OEM chooses to use, the design and ownership of the product still remains under the OEM and not the subcontractor.

Pharmaceutical Manufacturing services: In this type of contract manufacturing, the main practice is having the actual drug manufacturing done by the subcontractor while the research and development is done solely by the original pharmaceutical company. Other types of contract manufacturing services under this industry include warehousing, distribution, quality control audits and packaging.

Medical contract manufacturing is a combination of the pharmaceutical and electronics contract manufacturing services. The products that are being manufactured are medical devices that may include electronics. Some forms of medical contract manufacturing involves providing medicine dispensers such as electronic insulin pump. When a company subcontracts for the medical device, it may require the subcontractor to link up with other pharmaceutical contract manufacturers so as to provide complete supply of both the device and the pharmaceuticals to the end consumer.

For companies that are new to outsourcing, they can use the help of the contract manufacturing agencies to get the right subcontractor to work with. The agency meets with the company to assess the level of outsourcing it requires and the types of services required. The agency will then on behalf of the company, conduct a research, interview and narrow the list of possible subcontractors who can meet the company’s demands comfortably. The the company can then go ahead and choose a subcontractor from the provided list of candidates.

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