Outsource vs In-House | Which is better for your business?

Tube Bending Machine Trial

Ever since the economic crash of 2008, the capital machinery market has been re-building itself. For many years the cost of buying outright machinery outweighed the work that businesses were getting and therefore they resorted to outsourcing their tube bending to contractors. Now that is all well and good, until the market picks back up and all of a sudden you’re paying over the odds for your tube. Getting out of the habit of passing the manufacture process to contractors is a difficult one, businesses tend to be tied into a contract and the parameters are such that it makes it uncomfortable to leave. So what is the best option for you? The following article will explain the benefits and cons of both, drawing upon Langbow’s long history in supplying both sides of the machinery market.

Outsource 

You may be surprised to hear that even the largest of manufacturing company’s still outsource certain elements of their product, we’re still surprised at the amount of enquiries we receive from large, well established manufacturers who are looking to bring part of the process in-house. So the argument for outsourcing doesn’t stand solely with SME’s, but what are the benefits? Well there’s the obvious immediate financial relief of not having to fork out for capital machinery, many businesses don’t have the necessary available capital for outright purchase, or they don’t have sustainable cash flow to hold up a finance agreement. So offloading to a business set-up purely to cater for that side of your manufacturing process is very attractive. Another benefit is added expertise, you may not have the depth of knowledge required to understand tube machinery within your business, you may not feel comfortable with day-to-day operation & maintenance of the equipment, or you just don’t wish to employ operators. Outsourcing gives you that guarantee of expertise within that field, and is a relatively secure way of making sure your product meets the standard.

There are disadvantages however; lack of control, uncertain delivery times, tied into contract, are all potential areas of souring your relationship with a contractor. At some point or another, you will have experienced an issue with one of the aforementioned, it’s just the nature of the beast, so which do you prefer? Internal organisation or external costs? It’s a question that we have been part of with our customers many times and it’s often the case they aren’t aware of second hand machinery that will do the job perfectly.

In-House  

The beauty of in-house machinery is the overall control that is given to you. You can oversee absolutely everything that is going on, from the time it takes for a bend, quality of bend, any issues with the machine all the way to the location you put it in. Another advantage is there is zero lead time on the delivery of parts so you don’t have to sit twiddling your thumbs waiting for it to be delivered. If you have the ability of being able to purchase a machine for your facility then it’s a decision wisely made, generally speaking people prefer to have full control, and although there is a significant up-front cost in the short term, the long term upsides will eventually outweigh it.

As previously mentioned, the cost of purchase is something not everyone is willing to pay, that and the maintenance required either from an employee or a service contract from ourselves, it soon becomes a question that is hard to answer.

So what’s the bottom line? If you’re an SME who has low volumes of bent parts, out-sourcing would be a sensible choice. If you’re an SME with medium volumes of bent parts, perhaps a second hand machine is something you’d consider, Langbow sell a variety of second hand machines and we’re always adding them to our showroom, they’re an affordable & automated solution that would suit a business in the medium volume sector. There is a case for an SME with medium volumes but has the necessary capital to purchase a new machine, if that sounds like you then by all means go down that route, the newer machines are more reliable, quicker, have more automation capability and the newest technology to aid your manufacture process. If you’re a larger business with high volumes then 9 times out of 10 we would recommend new machinery, based purely on reliability, sustainability and being up-to-date with the necessary in-stock spare parts for the certainty of requirement for them.

Whatever it is you’re after, whether you are a contractor yourself, a small business with requirements for machines or a large firm with an established base, Langbow has and will continue to cater for all areas of the industry. Whilst you’re on the website please have a look around and see what Langbow can do for you.

If you have any enquiries you’d like to discuss more with us then please fill out our contact form on the contact page, or give us a call on 01889 575 380. 

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