Medical Device Link .

Making the Right Call on Contract Machining A number of factors can help you decide whether or not to outsource machining work. When it comes to machining, there’s a lot to be said for outsourcing. Then again, there’s also a lot to be said for not outsourcing. So what’s a medical device manufacturer to do? Of course, there’s no single right answer. It depends on the particulars of the job, the type of machining, and the concerns and capabilities of the OEM itself. But good calls on outsourcing are likely to come after OEMs carefully consider both sides of the issue, take advantage of help offered in making the decision, and answer some fundamental questions about themselves. When OEMs don’t have an in-house machining operation, they have to incur substantial costs to set one up. These costs include the price of purchasing machines, hiring people to run them, and allocating facility space for the work, says Steve Kappers, president of (Batavia, OH), which does contract machining work for medical device companies. A single machine and the tooling it requires can cost half a million dollars, notes David Drechsler, vice president of sales and marketing for (Clover, SC), which sells machining equipment. An expenditure of that magnitude may be particularly unwise if the OEM is making a new product that could “bomb in the marketplace,” explains Drechsler. “So smaller companies will usually outsource machining work until they have enough volume to justify investing in the equipment and infrastructure to do it themselves.” At the outset of their ventures, the heads of many start-up companies decide against large capital expenditures for equipment. These companies are designed to outsource machining and other manufacturing processes, according to Jack Fulton, vice president of sales and marketing for Specialized Medical Devices Inc. (Lancaster, PA), a contract manufacturer