Reasons To Outsource


The main reasons for outsourcing your manufacturing are:

  • Cost Savings – Outsourcing your manufacturing to a low-cost labor market will drastically lower the “labor” cost associated with your products. Depending on the ratio of “labor” to the other cost of goods sold expenses in the products you sell, this reduction in labor costs has the potential to exponentially increase your profit margins.
  • Cost Restructuring – Outsourcing your manufacturing drastically reduces your operating leverage by decreasing the ratio of fixed to variable expenses. Essentially, your fixed manufacturing costs are almost completely replaced with predictable variable costs.
  • Improved Quality – Superior quality control can be obtained with outsourcing if you choose the right provider and setup the relationship correctly. To choose the right provider: make sure that they registered with at least one internationally recognized organization that is focused on quality – such as ISO or FDA. To setup the relationship correctly, make sure that you have thoroughly documented quality specifications and that your provider is willing and able to accept responsibility for delivering according to those specifications.
  • Access To Operational Expertise – Outsourcing your manufacturing to a competent provider allows you easy and inexpensive access to operational best practices that would be too difficult or time consuming to develop in-house. Our core competency has always been manufacturing. Over the years we have developed an unprecedented level of experience and knowledge that we can easily apply to manufacturing your products – outsourcing with CaliBaja can save you the hassle of re-engineering the wheel.
  • Reduced Liability – In-house production entails many of types of risk. Quality, on-time delivery, employee safety; the list goes on and on. Anytime you perform a function internally – you are liable for the outcome. With CaliBaja, the extensive liabilities associated with in-house production are no longer your concern. If we agree to deliver 10,000 units per month at a set price-per-piece, we are responsible for making it happen.
  • Reduced Time To Market – The amount of time it takes to bring a new product to market can be substantially reduced with outsourcing as you are able to greatly accelerate production ramp-up through the additional capability brought by the supplier. An operation that would take you months to develop in-house, can be started up in a matter of days with outsourcing – this has enabled numerous clients of ours to enter new markets and offer products that never would have been possible with in-house production.
  • Access To New Markets – Working with an offshore supplier gives you the ability to access foreign markets that were once unobtainable due to the lack of physical proximity to your manufacturing operation.
  • Ability To Focus On Your Core Competencies – One of the greatest advantages to outsourcing your production is the ability to focus on your core competencies. Without the constant demands of managing production, you will have more resources to allocate to growing your business.