Outsourcing and Contract Manufacturing are two terms that are, more or less, used interchangeably. Contract Manufacturing, in fact, is a form of outsourcing in which the parent company enters into an agreement with another manufacturing firm for the production of individual parts, products and components which were till then produced by them. Outsourcing work to an external firm helps the business to avoid investing in significantly expensive equipment and additional staff. Contract Manufacturing can be beneficial for small to medium-sized companies who would like to cut down their packaging and labeling expenses. It can also be used as a business tactic to enter new markets and enhance the business’ credibility in the region.
At Private Label and Licensing Middle East you will gain access to suitable contract manufacturing partners in the Middle East and African region. The three-day event will explore the possibilities of contract manufacturing in Dubai, UAE and the wider GCC. To be a part of this unique venture, register your entry for free or contact our team to book your exhibition stand today.
Benefits of Contract Manufacturing
Cost Saving Contract Manufacturing enables businesses to reduce their capital costs as they do not have to pay for either the equipment or facility needed for production.
Higher Quality Control A contract manufacturer typically has a good understanding of the product and industry. They are also likely to have in place superior quality control methods to detect faulty and damaged goods early in the production line.
Quick Turnaround As the contracted company specializes in the production of that particular product or item, they are likely to have a good relationship with raw supply manufacturers and more efficient production techniques that the parent company won’t have.
Economies of Scale A contract manufacturer usually works with multiple customers. Due to this, they can acquire raw materials and supplies at a reduced cost. Simply said, the size of the shipment is inversely proportional to the price per unit.
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