Contract manufacturing is an arrangement in which one company produces goods for another under an agreed specification. The buyer may own the brand, formula, design, tooling or some of the materials.
Contract Manufacturing: what the sourcing record should show
| Area | What to record |
|---|---|
| Decision | The agreement should define specification control, forecasts, material responsibility, change approval, yield, scrap, quality release, confidentiality, intellectual property and continuity. |
| Evidence | Confirm the actual production site, subcontracting, capacity, certifications, tooling ownership, testing and batch records. |
| Watch point | A contract manufacturer performs production. It may or may not design the product, source every material or own the regulatory approval. |
When does Contract Manufacturing matter?
The agreement should define specification control, forecasts, material responsibility, change approval, yield, scrap, quality release, confidentiality, intellectual property and continuity.
What should buyers check before approving Contract Manufacturing?
Confirm the actual production site, subcontracting, capacity, certifications, tooling ownership, testing and batch records.
A contract manufacturer performs production. It may or may not design the product, source every material or own the regulatory approval.
