Why is it worth using the component purchasing services of an EMS provider?
1. Cheaper components when buying entire packages and the ability to control key prices for the most important components
Buying component packages from a subcontractor (EMS) is cheaper than purchasing separate components individually from several suppliers. At the same time, the customer can control the prices of individual elements, particularly the key ones. The customer can negotiate project prices directly with the manufacturer and permit the EMS company to buy from a given source at an agreed price.
2. It’s cheaper for the purchaser to assemble components than for the customer to purchase the goods and assembly separately.
Order processing costs are calculated on preferential terms.
3. Lower operation costs
- No cost associated with transport to the customer’s warehouse
- Reduction of labor costs when ordering and purchasing components, so the focus is on the key elements
- No costs due to component quality control, complaints or mistakes
- Lower bookkeeping costs due to a lower number of invoices, transactions or bank transfers and, most importantly, no cost associated with accounting for materials after the production
- Lower costs of warehouse and inventory management
- No costs from human errors occurring in the processes above
4. Component waste in the production process
Around 1-2% of components normally go to waste during the production process. When the purchase of components is included in the assembly package, the cost of waste has already been calculated in the price – when they’re bought separately, this waste becomes an additional cost.
5. Component surplus after the production process
Component surplus is minimised through the product life-cycle management and by purchasing elements in the smallest possible quantities.
Up to 90 days of additional financing: The purchase of components takes about 30 days, another 30 days are needed for the assembly, and the remaining 30 days is the average time that the surplus components are kept in storage.
7. Product warranty and full responsibility for the processes
- The EMS provider, who buys the component package, is fully responsible for the quality of the end-product
- The PCB, which is the most important element of the module, should always be purchased by the company responsible for the assembly.
8. Defective components
Our vast experience in quality control and its related processes, implemented before assembly, helps our customers to avoid the dangers and costs associated with the use of defective components.
9. More effective business model
- Nowadays, the only business models that can guarantee success are those which, as per the ‘stick to the core’ principle, focus on processes that generate added value and profits
- A high degree of outsourcing: following the example of the biggest international companies
10. Control over the delivery schedule and just-in-time manufacturing
- The customer’s costs are lowered by our ability to store the produced modules in our warehouse to be released when needed
- A large team supervising the purchasing process allows for better control and more leverage in relations with electronic component suppliers