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What is a Contract Manufacturer?

5/12/2009

A contract manufacturer (CM) is a firm that manufactures components or products for another "hiring" firm. Contract manufacturing may include a single precision part or a complex subassembly of the finished product.

In contract manufacturing, the hiring firm - the OEM (original equipment manufacturer) - approaches a contract manufacturer like Plouse Precision Manufacturing, with a design or formula. The OEM is the company that owns the legal rights to a product. A contract manufacturer that is responsible to supply parts directly to the OEM would be considered a first tier supplier.  The CM will quote the parts based on material costs, tooling/fixturing, labor, and secondary processes. Once the OEM selects a source, the CM acts as the hiring firm's factory, producing and shipping units of the design on their behalf.

Many companies use contract manufacturing as an alternative to the expense of operating and maintaining their own factories. At our Harrisburg facility, we provide a unique value to OEMs. From CNC machining, grinding, assembly and fabrication to inspection and testing, Plouse provides a full spectrum of manufacturing services.

Plouse offers a set of cost-effective, leading edge solutions and platforms that deliver high performance, differentiated products to their clients. In the increasingly high-pressure environment of manufacturing, outsourcing has become a way of survival for many companies. CMs are utilized in today's cost competitive environment for their ability to drive cost out of the production of products through manufacturing efficiencies. Passing on a lower part cost to the OEM allows them to be competitive in today's global marketplace. As a single-source supplier, we are able to serve a variety of OEM companies and deliver products in accordance with the customer's requirements.

OEMs can rely on Plouse in the following ways:

• Commitment to customer satisfaction
• Precision manufacturing capabilities
• Relentless focus on customer service
• Global logistics
• Data-driven management

To learn more about Plouse Precision Manufacturing, visit us at PlouseManufacturing.com.

Talk to a specialist, call 717-558-8530 (during business hours).