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Sourcing & Suppliers

Contract Manufacturer

A contract manufacturer is a company that produces goods for another business under contract, usually to that business's specifications.

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A contract manufacturer makes products on behalf of a buyer, following the buyer's designs, specifications and quality standards. It lets a company access manufacturing capacity and expertise without owning factories, and scale production up or down as demand changes. Arrangements range from producing a single component to assembling a complete finished product for the buyer's brand.

Success depends on clear specifications, robust quality control and well-defined contract terms covering capacity, lead times, intellectual property and liability. It is a form of outsourcing production and a key option in any make-or-buy decision. Unlike an ODM, a contract manufacturer typically builds to the buyer's design rather than supplying its own.

Frequently asked questions

What is a contract manufacturer?
A contract manufacturer produces goods for another business under contract, usually to that business's own specifications, giving access to manufacturing capacity without owning factories.
How is a contract manufacturer different from an ODM?
A contract manufacturer typically builds to the buyer's design and specification, while an ODM supplies its own design that the buyer rebrands.

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