The margin on a product you purchase seem high ... you believe you can produce the same product and save money. This isn't always a good move. While the infrastructure required to manufacture a new or different part often seems trivial, it could easily cost you the margins you hoped to make. Worse, it could be a distraction that hurts your core competencies. It is critical that we know what is down each fork in the road... know when to actually manufacture and when simply to the research on how much it will cost to manufacture. So why do it? ... Leverage. When a vendor knows you have done the due diligence required to take on the manufacturing of their product, they are forced to look internally at eliminating waste/reducing cost. There is a price tipping point at which you will become discouraged in the endeavor of replacing them. They know that and will be much more willing to negotiate on price and delivery.
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