A practical way to begin reducing costs is through scheduled ordering of machined components. With scheduled orders, a larger total quantity can be purchased at one time while shipments are released in smaller quantities as needed. This often allows buyers to receive bulk-order price breaks based on the total order quantity.

Scheduled orders and stocking programs are also important parts of zero-inventory and Just-in-Time (JIT) inventory management systems. These systems can help reduce electronics manufacturing costs in multiple ways. For example, lowering warehousing requirements can reduce fixed costs and improve profit margins. Reducing held inventory also frees up resources that can often be used more effectively.

By working with a supplier to establish scheduled orders, OEM and EMS buyers can secure inventory, improve efficiency, and reduce costs. This is how Divine manages orders for long-term customers.

Another way to reduce sourcing costs is to work with offshore suppliers and explore cross-reference opportunities. Many offshore manufacturers can provide alternative parts with the same quality and performance at a lower cost. Identifying alternate manufacturers or cross-reference options for commodity-type components can lead to significant cost savings and improved delivery schedules.

Divine is often approved as an offshore supplier on customers’ approved vendor lists (AVL), which provides greater flexibility in the supply chain. This added flexibility can also reduce the need for spot buying.

Spot buys are often viewed negatively because of the costs involved, but they do not always have to be a disadvantage. When handled proactively as part of a cost-down strategy, spot buys can help reduce future risks and save money over time.

Spot buys are typically one-time, smaller orders made in response to an unexpected or urgent need, such as when a part becomes obsolete and an alternative is required, or when existing stock is not enough to complete a project. By maintaining a strong relationship with a supplier like Divine, who can monitor demand for your parts, customers can avoid overproduction and reduce the risk of excess inventory.

When sourcing the same component from multiple factories, incoming dimensional inspections often need to be performed separately, or parts may need to be sent to a lab for inspection and testing, which can increase costs. Whenever possible, bundling required services can help reduce overall manufacturing costs.

By working with a supplier like Divine, who can handle secondary operations and assembly services, OEM and EMS companies can reduce the need to send parts to third-party labs. With in-house testing capabilities, customers can save costs related to external inspection, assembly, and testing.

As a certified machined parts manufacturer, Divine can help OEM and EMS buyers reduce costs in many different ways. We can set up scheduled orders and custom stocking programs, while our internal component sourcing team can identify potential alternate manufacturers or cross-reference opportunities for commodity-type components.

With our in-house warehouse, inspection capabilities, and testing lab, Divine helps reduce electronics manufacturing costs by streamlining expenses related to secondary services. Schedule a call with one of our sourcing experts today to discuss how we can support your electronics manufacturing cost reduction goals.