Managing Contract Manufacturing Relationships

Contract manufacturing has become a cornerstone of global supply chains since the first wave of production outsourcing. Since then, brand-leading companies have focused their supply chains on the end consumer, while contract manufacturers have overtaken brand-leaders in various key areas. As a result, contract manufacturers are becoming strategic partners in the implementation of product designs, which requires dedicated relationship management to enable manufacturing coordination across company boundaries. This book addresses the relationship management of contract manufacturing relationships through the client's use of management practices. It adopts an eclectic transaction cost economics and relationship velocity perspective. To this end, applied management practices, relationship dynamics, and the targeted selection and adjustment of management practices are examined. The findings indicate the need for systematic alignment of client companies and contract manufacturers at commercial and social relationship levels. Furthermore, relationship dynamics require a regular assessment of the commercial and social fit. The findings contribute to the understanding of contract manufacturing relationships in literature and include recommendations for practical application.

About the author

Tim Brandl is a former research assistant and doctoral student at the Institute of Supply Chain Management at the University of St.Gallen (ISCM-HSG).