Product development is expensive. That’s true whether you’re designing the next life-saving medical device or developing an innovative industrial product. And the more you spend to design, develop, manufacture, ship, and service each product component, the less ROI you’ll see.
That’s obvious. But for many product developers, what’s not obvious is how to meaningfully reduce their total cost to increase profit and gain a competitive advantage.
Compromising on quality is not an option — especially for medical device manufacturers who must meet stringent regulatory guidelines. And outsourcing the production of components to international manufacturers is increasingly untenable. Geopolitical conflicts, fluctuating trade agreements, and hefty tariffs are causing many companies to bring offshore production stateside.
Despite these limitations, there are ways to drive costs down and make the market impact you’re looking for. You can do it while simultaneously maintaining exemplary quality standards and de-risking your business through regionalization. Here’s how.
1. Stop designing your product components in a silo.
Many OEMs look at component design and manufacturing as a step-by-step process. Designers spend months creating the ideal concept based on a pre-determined PRD. Then, once the design is finalized and tested, they shop it around and hand it over to whichever manufacturer offers the best production price.
This siloed approach is, quite frankly, ineffective. It invariably leads to costly rework that keeps companies from getting to market as quickly as they otherwise could.
Why? Design engineers don’t know what they don’t know. Yes, they’re experts in their own right — and they’re good at what they do. But they can’t predict the far-reaching manufacturing implications of every design choice they make. And they’re not familiar with all the creative options that can whittle down a component’s cost and “sharpen the blade” of production.
A holistic approach to component design.
That’s why you should bring an expert like MPE Inc. into your component design process long before you reach the production stage. Together with your design engineers, we can optimize your design to meet the complex, varied demands of producing your component to scale — now and down the road.
Leveraging our capital equipment commercialization platform, we’ll work with your design engineers to:
- Understand what users need from the component and from the product as a whole
- Look at each component in terms of how it fits within the overall assembly process
- Explore the implications of choosing one material over another (e.g. plating versus painting)
- Evaluate the component’s entire lifecycle — from initial production to future servicing requirements and beyond
- Understand the safety and regulatory requirements the product will be subject to
- Consider whether certain design choices will require custom tooling
- Look for ways to work within existing parameters (e.g. use equipment already on hand) to save time and money
It comes down to this: The most effective way to cut costs and speed up your time to market is to consider the manufacturing implications of your design choices before you start designing your components. When you don’t look at design through the lens of manufacturability from the outset, your costs will skyrocket.
2. Look for simple design changes that reduce manufacturing costs.
Even the smallest design choices can have an outsized impact on total production costs. For example, say your product design calls for a 6” stainless steel blade. A manufacturer might need to purchase a new piece of equipment to produce a blade of that size, even though they could fashion a 5” blade with the equipment they already have. That 1” may not make any difference in the product’s performance — but it might make a sizable difference in its total cost.
Something we see all the time is the opportunity to replace threaded pins (which are pressed into sheet metal for screws to go into) with tap extrudes. Using a turret laser, we can extrude the actual metal and put a thread directly into it so a pin isn’t needed. This little tweak can save several dollars per part and eliminate the future need to replace pins that eventually fall out.
Think about something like welding. Manually welding large components together into one main component takes a long time and drives up costs. But if you can design your components so they can be spot welded — and if your manufacturer has a robotic spot welder on hand — that one simple change will save you significant amounts of time and money.
There are cost optimization opportunities beyond the manufacturing assembly line, too. We helped a recent client evaluate their high-volume shipping and packaging needs and create a returnable, refillable container that completely eliminated dunnage (and substantial ongoing packaging expenses) from the equation.
For one client, adjustments like these reduced their per-product cost by 32% and their shipping expenses by 42%.
3. Optimize international component designs for the realities of stateside production.
Designs generated in Asia and other offshore manufacturing hubs are inordinately labor-intensive. In these locations, hiring a workforce is much less expensive than it is here in the U.S. There, what companies lack in equipment, automation, and robotics, they make up for in plentiful, inexpensive labor.
That means if you’re in the process of future-proofing your business and investing in regionalization, you shouldn’t simply give your existing designs to a manufacturer here. Rather, you’ll need to convert your design to make sure it functions efficiently within a wholly different system.
This can be a long and complex process, and it’s best not to go it alone. MPE Inc. can help you:
- Select and source materials that are readily available in the U.S. (these may be different than those available in other parts of the world)
- Convert units of measure to ensure designs line up with common U.S. sizing standards
- Find opportunities to automate processes and speed up assembly — for example, by utilizing tools such as progressive stamping, robotic welding, and quick turn cells
- Consider the entire supply chain your component depends on — parts, supplies, packaging, etc.
True, the sticker price for a “Made in the U.S.A” component may always be higher than the equivalent part coming from Asia or another market. However, tariffs and duties can significantly increase the final cost of international production and, by extension, the per-unit price. Furthermore, in an uncertain geopolitical climate, you never know when trade agreements may suddenly fall through and leave you without a component you’re counting on.
Partnering with an onshore manufacturer like MPE Inc. mitigates these risks and protects your market share for the long haul.
MPE Inc. can reduce your component costs and speed up your time to market.
It’s common for OEMs to encounter obstacles and challenges of all kinds on the path to product development profitability. A traditional, sequential approach to component design and development will only multiply those obstacles and negatively affect your bottom line.
There is a better way.
MPE Inc.’s capital equipment commercialization platform infuses compliance, differentiation, and market readiness into every stage of your product’s life cycle. Our onshore, integrated team of experts can take your component from design to manufacturing and beyond — all while reducing your total cost of ownership.
Your market edge is out there. Let’s find it together.