Contract Manufacturer

A contract manufacturer (CM) is a third-party manufacturer of components or products for a company. This is a form of outsourcing. A company generally approaches a CM with a design or product and ask for pricing to manufacture based upon variables like processes, labor, tooling, and material costs. There can be numerous benefits to using a CM, such as cost savings, quality, access to advanced skills, and economies of scale. However, there can be risks as well, including lack of control, loss of flexibility and responsiveness, and less ability to control quality.