Greg Fisher is the founder of Hardware Massive and CEO of Berkeley Sourcing Group. A serial entrepreneur with over 10 years experience, he has helped more than 800 hardware startups manufacture innovative ideas in China at costs and quality that can help them compete with larger, established businesses.
If you're like most hardware entrepreneurs, crowdfunding will be your means of getting your product off the ground in order to generate initial revenue and awareness. However, many startups before you have learned that issues can and will arise during production, which ultimately led to delays in their product being shipped on time to excited crowdfunding backers.
Here at Berkeley Sourcing Group we’ve evaluated and worked with hundreds of hardware startups on developing and manufacturing innovative products. From our work we’ve learned a lot about the issues and challenges startups will face when taking their first product to production. In order to avoid or prepare for these issues, we have put together a list of planning and scheduling best practices you can use with your manufacturing partners and suppliers to ensure your product is completed on schedule.
A Gantt Chart (Production Schedule Report) is the most useful tool that a hardware startup can use to understand the delivery time of their final product and for each process. Ask your supplier to provide a Gantt Chart after you place the PO (purchase order) and have them constantly update it for you if there is a delay or if they are ahead of schedule during the entire production.
Daily Capacity Report is another other valuable practice. It helps you understand the capacity of your product and gives a rough idea on how much time it will take to produce your product once the tooling on machine has been loaded. For example, if one day you see the capacity is much lower than normal, you can ask your supplier for the reasons and difficulties and see if you can do anything to help or troubleshoot the problem.
Understand Lead Times! We found over 50% of our customers had no idea about the lead time and capacity of their products, so they placed the PO and gave too limited time for the manufacturers to finish the PO. Startups must realize that regardless of how much effort a supplier tries to speed things up, the product might not be able to finished at the required date due to the limited capacities they have. For example, the capacity for a watch strap we produce is about 1500pcs including defects (60mins / 5 mins forming time each cavity * 6 cavities * 22 working hours).
- Startups also need to know the factory may not be able to produce your product immediately after you place the PO. A lot of the lead time to making your product is waiting in line for the machines to be available at the factory. Therefore, it is very useful if startups can learn the lead time and capacity from the supplier first. So communicate with your manufacturing partner when you expect to place an order so they can prepare their production schedule. Also be aware on the first run or two there are unexpected issues that could delay things relative to the lead times quoted.
If possible, order more quantity than needed. Normally a lot of factories will run into shortage at the end of production due to the defects. They will then have to replenish those shortages, which takes time and might lead to delays. If you order more quantity, this might help to save those times.
Troubleshooting before production is very important to significantly reduce the lead time of the product. If the product still has many unsolved technical problems or if it has not been thoroughly evaluated before production, these problems will all come up during production and will significantly delay the delivery time. In order to bring you a smooth production, make sure to evaluate and troubleshoot the product with your supplier in each process to understand the difficulties in order to clear those hurdles (maybe change the designs or tolerance if the technology is limited, change different processes, replace more qualified factories, etc.).
If you see your order is (or will be) growing, think of solutions that could help speed up production. Suggestions could be to:
- Open more tooling to increase the capacity
- Provide the order forecast to supplier, so the factory can arrange your production schedule beforehand and purchase material or keep important components in stock first, etc.
Hopefully, these best practices will get you thinking of how to plan ahead and avoid some of the situations your fellow entrepreneurs have run into. The end goal of this is everyone being happier from your supplier knowing you understand how they operate, to you getting products shipped on time and your backers getting it delivered on time.