Particularly in the low- to mid-volume production space, supply chain needs can vary dramatically from OEM to OEM. For example, some of our customers can forecast well because their customers provide long lead times. Others aren’t so lucky and have difficulty anticipating demand. Yet other manufacturers are somewhere in the middle.
At OCM Manufacturing, we focus on the high-mix, low- to mid-volume electronics manufacturing segment, and customized supply chain solutions are part of how we do business. There are hundreds of ways to slice and dice the supply chain, and we tailor supply chain solutions to each customer.
It’s all about lead time
The ability to forecast demand is what supply chain management is all about. But, as mentioned above, that isn’t a luxury that every OEM has on every product line. The key is communication – supply chain managers (e.g. OCM Manufacturing) need as much information as possible, as early as possible, to tailor the right solution to each customers.
The most common mistake that OEMs make is failing to plan for and inventory long-lead parts. Without this planning, the OEM is in constant expedite or “scramble” mode, and will be unable to handle upticks in customer demand. Put another way, poor planning can severely jeopardize an OEM’s ability to deliver to customers.
The art and science of supply chain management
There are a number of ways that we work with customers to manage their unique, and sometimes challenging, supply chain needs. For example, through bonding agreements, we are able to ask suppliers to hold inventory us to shorten lead times. We are also able to hold customer inventory at OCM, as well as holding finished goods in inventory.
Most of the supply chain management solutions we design and manage for customers include a combination of supply and inventory arrangements. For a single product, certain parts may be bonded, others inventoried, and others managed on-demand. These solutions focus on shortening lead times, minimizing the risk of parts becoming stranded, and enabling customer to better respond to demand.
We purchase materials on customers’ behalf and hold inventory or minimum stock for some, based on each customer’s risk profile. Not all customers choose or need to be proactive in these ways, in which case we go to the supply chain when an order comes in and the longest lead-time part dictates delivery.
It’s never too early to plan
Even if you feel you’re in a position that doesn’t allow you to plan or forecast, it’s critical to develop your supply chain solution as early as possible. For our customers, that means talking to us early, and regularly, about business plans and customer demands – no matter how tentative they may be.
Allowing us to review designs early in the process is also useful, as our design for manufacturing (DFM) services can identify AND MITIGATE potential common supply risk factors, such as single-source components.
Please contact us about your low-to-mid-volume, electronics manufacturing and supply chain questions or needs.