Starting a small business is one of the best things to do if you want to take your future into your own hands. You also have the possibility to make a large amount of money. Of course, the success of your business depends on a variety of different decisions. One of those decisions will be whether to manufacture your own products or have someone else do it. To help make that decision, answer these four questions.
Do You Have the Ability the Manufacture Your Own Products?
The first step is to evaluate your ability to do the manufacturing yourself. Do you have a location to work? Do you have all of the tools you need? Do you have the required employees? Do you have a system in place for quality control and production? These seemingly small tasks are all handled by the manufacturer if you go with someone else.
Can You Manufacture Your Own Products as Cheap as a Manufacturer?
Everything in business comes down to cost. Analyze the cost associated with manufacturing your own items versus what it would cost to go to a manufacturer. Determine if you would need a material supplier to provide you with basic materials and figure out pricing per product. Talk to a professional accountant familiar with manufacturing to cover all of your bases. It might be financially smarter to go with an outside manufacturer.
Can You Produce the Amount of Product You Need?
If business is booming, you will need to raise manufacturing demands. This comes with a lot of cost, especially if you need to buy more equipment, rent a larger building, and hire new people. Until you can do that, you might need to go to a manufacturer who is already set up for high volume.
How Much Say Do You Need over the Manufacturing Process?
When you manufacture your own product yourself, you have say over absolutely everything from the packaging to quality control to the environmental factors involved throughout the process. Plus, you get to create your team and watch over them yourself. When you go to a manufacturer, they have control. Now, there are manufactures that like to involve you in the process as much as possible and may give you packaging options. You can also research companies to go with a manufacturer with a similar mission to your company. However, you still won’t have the level of control you would have if you handled everything yourself.
Having a product available for the customers is one of the most important parts of running your business. Ask yourself these questions to determine how you will get that done.
Emma is a freelance writer based out of Boston, MA. She writes most often on health and education. When not writing, she enjoys reading and watching film noir. Say hi on Twitter @EmmaSturgis2