Getting it Right the First Time: Manufacturing a Technology Product

While Canada’s software sector seems burgeoning with startups, there is also a good amount of activity on the hardware side of the house.

Certainly, Canada has lost a considerable number of manufacturing sector jobs in recent years, but this is offset by a deep pool of engineering talent responsible for starting new companies, developing new product ideas, manufacturing, and exporting new products.

If your team is contemplating a product that requires manufacturing, there are a few key factors to keep in mind to increase the likelihood of market success.

Although it seems obvious, it’s possibly the most overlooked element of developing a new hardware-based product: the design must be manufacturable. “Manufacturability” refers not to “can it be made?”—because nearly anything is possible—but rather, “can it be made at a cost that is sustainable?”

This means designing the product in such a way as to drive down the cost of the labour to produce the product and optimizing the components within the product to reduce risk in the supply chain while still achieving the product’s purpose and application. Many potentially great products are crippled out of the gate because their design is not automation-friendly. Many others become crippled in the future because of difficulty sourcing the parts as production volumes increase.

As much as 90% of the cost of an electronic product is determined before it reaches manufacturing stage. Decisions made during design directly affect a product’s manufacturability, but the impact of these decisions may not be known until a product reaches the company that’s going to manufacture your product. By that time, design changes are often too costly or may delay market launch too much to allow for implementation. So, it’s important to talk to a contract manufacturer early in the process. Waiting too long to do this due diligence, or not carrying it out to the necessary levels, will hamper your products’ chances for success in the market.

Even during the prototype stage the manufacturing aspects of the product should be assessed: not just “will it work?” but also “can we produce it for a price that will sell?” Achieving functionality as a prototype is only one level of success. Your prototype manufacturer should also provide important direction around cost and manufacturability.

The trend today is to outsource manufacturing to companies that specialize in it. There are many advantages to you as a startup partnering early with a manufacturer. These include: much-reduced risk, lower direct labour costs, reduced capital investment, improved utilization of assets, and access to economies of scale. It’s also beneficial because it allows your company to concentrate on what you do best—conceiving and designing the product—while your contract manufacturer works along side your team, providing critical manufacturing input along the way.

Niche products, often called low- to mid-volume product lines, are some of the most successful produced in Canada today. You, too, can successfully exploit market opportunities that do not attract the attention of bigger players—provided that you get the “manufacturing” part of the equation done correctly.

If you have a concept for an electronics-based product that meets a unique need in a defined industry, make sure to do your homework. Consult with professionals who have the expertise to guide you through the manufacturing process. Done right, it can position your new product for success.

In today’s competitive economy, you must align every aspect of the product design-manufacturing-and sales cycle to have the best chance to succeed.