Rough Guide to Outsourcing In China

zentec writes, "An article in Design News chronicles WiLife's outsourcing project to China (they make consumer surveillance cameras). It's a tale of a language barrier, misplaced EEPROMS, backyard engineering, incorrectly assembled parts, sloppy engineering, and flaring tempers. That, and an initial defect rate of nearly 80%." In the end WiLife seemed happy enough with their outsourced manufacturing. This is a nitty-gritty account of life under globalization.

Comments

Please don't insult Slashdotters...

[xxxJonBoyxxx]

It's a tale of a language barrier, backyard engineering...

I hope you came to do something more productive than ridicule Slashdotters.

And this is surprising?

[Jhon]

From the article's author:

In CM's defense, this is the most complex PCA they have manufactured to date. It pushes the limits of their capabilities. The main PCA contains three BGAs and several high pin density surface mount devices. The bulk of CM's output is fairly simple mice and game controllers. CM top management wants to work with WiLife because it forces their factory to enhance their capabilities.

The author himself says they went with a firm that had never worked on anything more complicated than mice or game controllers. Of course they were going to encounter problems. And it looks like they were OK with that with the deal they were getting...

Re:And this is surprising?

[seanadams.com]

Exactly. There are precisely two kinds of contract manufacturers in the world:

i) Extremely good ones
ii) Extremely bad ones

I have worked with both, both domestically and in Asia.

To get a good CM to build your product you will have to choose them really carefully, and you will also need to have enough volume to make it interesting for them. They will gladly work for razor thin margins as long as you are building enough. However, even if your product is a big-ticket item, it is very hard to get any electronics manufactured in small volumes unless you can buy 100% of the parts from Digikey.

With some excedptions, a good Asian manufacturer can get electronics built cheaper, faster, and with much better quality than any American shop. It's not just their lower labor cost but also that all your upstream suppliers will be geographically close to the factory, which not only drasstically lowers shipping and handling costs, but also allows the buyers to work with them directly instead of you haveing to go through at least one layer of incompetent middlemen.

This guy had a bad experience. Shit happens. It is not indicative of what is possible with proper planning and a good business arrangement.

the operative word

[User 956]

In the end WiLife seemed happy enough with their outsourced manufacturing.

The key word: "happy enough". Meaning, not entirely happy, but they saved enough money that it doesn't matter if everything was stellar. It doesn't matter if the products have an operational life of 13 months. As long as they chug along for a while, and break outside of warranty.

I'll keep paying a premium for german engineered and manufactured goods, thanks.

China

[TheRecklessWanderer]

We test stuff from China. Most of it we don't buy because the quality isn't there. It isn't that much cheaper than the stuff that comes from Taiwan. The Korean stuff isn't bad, better than China, but is hit and miss sometimes. Doing business with China is hard because you really can't return stuff to them. Some of the more advanced companies have "depots" in Hong Kong, but not many yet. Look at Japan 30 years ago, or Taiwan/Korea 10 to 15 years ago, and they were in the same state that China is in now. Today, Japanese product comes at a premium, and is superior to most product (IMHO) that is manufactured here in North America (vehicles immediately spring to mind). Once the Chinese people get their head around the different methodology of doing business in North America, they will come in full force and North America will have some serious issues to deal with.

Globalists would trade with Nazi Germany

[Travoltus]

as long as Germany's Jews made cheap lamp shades for America, free trade apologists would be in favor of letting the Nazi's own all our debt and our jobs.

What with China's political purges (50 million dead there), harvesting of political prisoners (millions dead there) for body parts, the citizens slaughtering their baby girls (200 million dead there), China is in every POSSIBLE way worse than Nazi Germany.

Welcome to the world of globalism and free trade: for America to compete, we need to go back to the days of sweat shops, factories falling apart, workers being chopped to death by faulty machinery, superpollution, and collapsing mines...er, wait a minute...

Oh and before you neo cons say it, no, there isn't a new thing for misplaced workers to retrain for. Biotech is going offshore. Alternative energy is just going to replace traditional energy jobs. We're not going into a new era of explosive job growth - except, oh maybe the tourism, cashier, waiter and janitor industry. Got belhop hat?

Re:Globalists would trade with Nazi Germany

[s20451]

The irony is that China, fearing foreign influence, placed heavy restrictions on trade starting in the 18th century. As a direct result, they eventually fell so far behind the West that the British were able to capture Hong Kong by 1842, and had opened trading routes by force by the 1860s.

If the USA closes its borders to trade, China's size and emerging economic power will mean that America will be fucked eventually anway. You've got the choice of being a barista now, or a serf later.

No mention of the "Third Shift"

[tlhIngan]

The third shift is slang for when the CM continues to manufacture more of your product without being asked about it. The goal, of course, is to shunt this product to a separate market and undercut your production (after all, they don't have marketing, R&D, etc to pay for). Since these CMs often handle inventory for you, they can order extra parts without you knowing.

Or they take your design, modify it, and manufacture their own (possibly inferior) version. They have everything they need - board layouts (schematic can be derived), binary object code (for FPGAs, flash memory, etc), parts lists, etc.

Just a hazard of outsourced production.

A Newbie Goes to China

[StateOfTheUnion]

If this guy's engineering and contracting skills are anything like his travel advice, it's no wonder that he wasn't well prepared for the challenges. He gives some silly travel advice . . . I have been to China, Taiwan, Indonesia and a host of other countries executing projects. I can say from experience that: Western style hotels purify their water. It is safe to drink. Silverware that has been washed properly doesn not need to be "sanitized with tea." Fruits and vegetables that have rinds or peels can be eaten uncooked if they are peeled first (e.g. bananas). You don't need a GPS to survive in a foreign country. Westerners have traveled to foreign countries and returned safely since well before the first GPS satellite was launched. In fact if your in a bad area of town a GPS may be just the thing to attract a snatch and grab thief. Same holds for mobile phones. Nice to have, but people have been going to China since well before mobile phones. Though some of the advice given is good, some of it is plain rubbish. China is offically atheist, but expressions of religion are tolerated. And overstaying your visa is not a courtesy issue, its a legal issue. This kind of stuff sounds like the writings of someone that read an outdated travel guide for the xenophobic. I can only imagine that some of the problems this guy had with his contract manufacturer were because he know what he was getting into either travel wise of contract manufacturing wise . . . For example, how come he didn't have another copy of his design drawings for the plastic case with him? That was poor preparation. Not having a spare copy can cost thousands of dollars when you're overseas. And did he really think that the CM woudln't want to redesign the case? Their engineers often try to redesign things to save costs of improve performance. It sounds to me like this guy's bread and butter is components in cameras . . . not plastics injection molding. Advice from the plastics company was probably good helpful advice. Why would he discount such advice? Why would he not put enough float in his schedule so that the manufacturers engineers could review his designs . . . after all, they are the manufacturing experts. I think that this article would be better titled "A Newbie Goes to China" From the linked article:

Al Mudrow's Tips For Traveling in China: 1. Plan a trip to China the same way you would plan an extended backpacking trip into the wilderness. Start with a backpacking checklist. Leave off the obvious items of tent, sleeping bag and sleeping pad. Pretty much everything else on your list is useful. 2. China is a cash-based economy. Credit cards can be used in high-end western hotels but nowhere else. You can get cash through your hotel, banks or "grey-market" foreign exchange shops. 3. China is mostly BYOTP (bring your own toilet paper). Always carry tissue paper with you when you venture out of the hotel. 4. Don't drink the tap water, no matter how fancy or western your hotel. Use provided bottled water. I carry water purification tablets if I want additional water. 5. Be very aware of traffic as you are walking around. Cars and motorcycles come in all directions. Motorcycles especially seem to obey no traffic rules. Vehicles commonly travel on sidewalks as well. Be especially careful of trucks made from converted farm roto-tillers. They don't have brakes. 6. Take a GPS receiver with you. Mark the important waypoints like your hotel, your CM factory and vendor locations. You can use it guide your way when your CM forgets to pick you up, or when guiding your taxi driver, who will inevitably get lost. 7. Always carry a mobile phone with you. Find out before you leave if your mobile phone will work in China. 8. Get a Skype account and purchase Skype-out minutes. Phone calls back to the U.S. and within China are about 3 cents a minute. Quality is better than both mobile phones and even local telephones. 9. In restaurants, use the tea they pour you to sanitize your eating utensils and dinnerware. Only eat food