"I think South Africa probably has one of the best environments for a start-ups anywhere," Richard Schulz, managing director, said from his base in Durban, South Africa, where he employs seven people in design and subcontracts manufacturing to a number of companies.
To create links with SMEs, large firms use combined methods such as licensing, R&D or manufacturing subcontracting, collaborative development, joint ventures, spin-outs or corporate venture (Rothwell 1989).
Z-Medica, which has 10 employees, currently subcontracts the manufacturing of QuikClot to CW Resources in New Britain.
They did the design, engineering and assembly work but subcontracted the manufacturing of parts to other suppliers in what Mr Dowson describes as "Motorsport Valley", an area stretching through the middle of England.
A company that subcontracts its manufacturing to foreigners will soon lose the expertise to design and the ability to innovate, because it won't get the feedback it needs.
So local suppliers, to which you subcontract your manufacturing, have to be coaxed both to keep their prices down and to push their standards up in ways that may seem reasonable in California, but look decidedly odd in Asia.On October 18th, with commendable frankness, Reebok published a 41-page report on how it was walking this particular tightrope in Indonesia.
"We subcontract routine manufacturing and electronics, but retain all operations in our core competence--major switching.
A genetic algorithm based heuristic is proposed to solve the model for minimization of the overall cost considering various manufacturing aspects such as production volume, multiple process route, machine capacity, material handling and subcontracting part operation.
HTC made a huge name for itself by subcontracting for others and their work has won accolades, giving them a great stepping stone towards manufacturing their own goodies.
Having enough money for R.& D., manufacturing, inventory and account-receivable financing usually does not leave enough for setting up your own factory and/or subcontracting domestic production.
