How to buy contract manufacturing
A contract manufacturer sells capacity against your data package. What you are really buying is the discipline that keeps your data package and its finished parts in agreement.
This category covers build to print manufacturing, kitting and assembly work packages: the supplier that makes what your drawings define, at a rate you set, without holding the design. A shop selling one process belongs in the machining, composites, castings or coatings guides. A firm that would own the design belongs in design and stress engineering. The distinction is the whole commercial relationship, and it should be written down before the first quotation.
Design authority decides who carries the risk
In build to print, the buyer owns the definition and the consequences of it. If a dimension cannot be held, the supplier raises a deviation and you decide. If the assembly does not go together, the drawing is usually the reason and the cost is yours. Say plainly in the request for quotation which party may change anything, how a concession is raised, who signs it, and what the supplier does when it believes the data is wrong. A supplier that quietly makes parts fit is a worse supplier than one that stops the line and calls you.
Where the finished article is allowed to go
A contract manufacturer's output is only as useful as the route it can travel. The rule on replacement and modification articles lists those routes: production under a type certificate, under an FAA production approval, as a standard part made to a government or industry specification, as a commercial part, by an owner or operator for their own product, by an appropriately rated certificate holder where the article is consumed in a repair, or in another manner approved by the FAA.2 Outside the first two, a producer may not represent the article as suitable for installation on a type certificated product.2 So establish early whether the supplier is making parts that will be installed under your approval, and make sure both sides describe that the same way in writing.
You are inheriting somebody's quality system
A production approval holder must run a quality system that controls design data and documents and that controls suppliers, with procedures ensuring supplier-provided articles conform and a process by which suppliers report those that do not.1 That requirement is why flowdowns exist and why they arrive without negotiation. Ask which of your customer's requirements reach the contract manufacturer, which reach its own subcontractors, and who audits whom. Ask how the supplier controls revision changes to your data package, because a shop building to a superseded revision is the most expensive quiet failure in this category. On defense work, check what the drawing calls out: defense standards are published and searchable, and a document shows as active, inactive or cancelled with its dates.4
The data package is an asset, so contract it
For government-funded work the rights in technical data are defined and negotiated. Unlimited rights allow use and disclosure without restriction, government purpose rights run five years or another negotiated period where funding was mixed, and limited rights keep data inside the government, which may not use it for manufacture or release it without written permission.3 Commercially, the same question is who may quote your parts to somebody else. Settle ownership of the data package, the tooling, the fixtures and the programs, and settle what happens to all of them at the end of the agreement.
Questions that sort suppliers
Ask what portion of the package is made in house and who performs the rest. Ask what rate the shop has actually run on comparable work, and what broke when it ramped. Ask how a nonconformance is reported and how quickly you would hear. Ask what happens to your tooling, your programs and your unbuilt kits if you leave.
The companies below are listed on public facts, each with its source linked.
Sources, in the order cited
- 1Electronic Code of Federal Regulations · 14 CFR Part 21 Subpart G, Production Certificates
- 2Electronic Code of Federal Regulations · 14 CFR 21.9, Replacement and modification articles
- 3Acquisition.gov · DFARS 252.227-7013, Rights in Technical Data, Noncommercial Items
- 4Defense Logistics Agency · ASSIST Quick Search, the defense standardization document register