When most people think about outsourcing, they think about outsourcing specific business-related tasks such as bookkeeping, web design/internet content, marketing, training, etc. What people don’t realize is that outsourcing products rather than developing products has become a major business model for some industries.
We’re in the complementary branding business. Period. But we can’t cover our eyes and pretend that that’s the only strategy to diversify product offerings. Outsourcing product development is another way to go. It will be costlier and more time-consuming than complementary branding, but there are still benefits to outsourcing as a business model.
Outsourcing Product Development Allows you to Take Advantage of Multidisciplinary Experts
Unless you’re a large enough company to justify a massive development team, it’s likely that you only have a few designers on your team. If any. It doesn’t matter how imaginative they might be, they’re designs are limited to their own experiences and knowledge base. If you don’t have an in-house design team already, adding this department to your operation will not only bring logistical, HR and legal challenges, but will also place a big dent on your overhead expenses.
Companies that specialize in product development have multidisciplinary experts who will listen to what you want from a new product and come up with multiple designs that will likely exceed your expectations. You don’t have to deal with payroll and everything else that managing an employee represents, and you can get an industry expert for the fraction of the cost.
Outsourcing Product Development Actually Lowers your Development Costs
Lower production costs represents the main reasons so many businesses have jumped on the product outsourcing bus. Not only does the outsourcing firm have a multidisciplinary design team, but they also have access to technology your business simply can’t afford to purchase, technology that expedites the design and testing process, which results in lower production costs.
The production team spreads the cost of the technology throughout several different projects, which is why they’re able to design and create your products at a considerably lower rate than your business can accomplish. They also do this day in and day out, developing additional expertise on budget-friendly materials, assembly and other strategies that will save you money.
Outsourcing Product Development Increases Efficiency
Product development firms have design teams that often have decades of accumulated experience, which they use to streamline the development process to reduce the amount of time it takes to get your product from the development to ready-to-be-sold stage. The same company also has resources to multitask during the project which allows them to anticipate and divert problems before they occur, build early prototypes, and gauge consumer interest more efficiently than the average business can.
Outsourcing Product Development Leads to Improved Production Timeline Management
Creating and managing a production timeline is one of those projects that sounds a great deal easier than it really is. It’s difficult for the average business owner or manager to accurately predict how long each of the development tasks will take, and it usually doesn’t take long before something takes too long and the entire project is behind schedule. Outsourcing usually resolves all production timeline problems, as well as takes all the project management tasks out of your hands.
The outsourcing firm that takes on the product development project has a great deal of experience assigning deadlines and making sure all the resources needed to meet the deadlines are readily available to the design team. The timeline the outsourcing firm creates should include deadlines for all stages of the development process, including:
- When initial sketches will be submitted
- When the prototypes will be ready for testing
- When the product will reach the production stage
All the major and minor milestones should be included in the timeline. All parties involved in the project must sign off on the timeline before the project starts.
Outsourcing product development, while easier than developing a product in-house, can still be a daunting task. If you considered outsourcing product development but don’t have the time or resources, check out some of our blog posts on complementary branding. You might be pleasantly surprised.