Outsource Financial Services understands the unique liquidity needs of contract manufacturers and their suppliers, and our experienced account managers are here to help you manage the routine challenges that tie up capital and time for your business.
We have talent that has worked with Tier 1-4 contract manufacturing and supply chain analysis, payment terms and pricing, and can help structure a solution to keep your cash at work.
For example, Electronics Manufacturing Services companies and other contract manufacturers face several challenges in managing liquidity:
- In many commercial markets, OEM orders are uniform and regular leading to efficient manufacturing. EMS box builders that service this market are typically those that focus on high volume, low mix, and low complexity.
- EMS box builders that service industrial markets, government markets, and military markets are generally those that focus on high complexity, high mix, and low volume products.
- For these markets, acquisition cycles are driven by other factors (immediate need, budgets, etc.) not by efficient manufacturing. It is up to the EMS box builder to balance the terms with the OEM and the terms with the supply chain to maintain liquidity while maintaining an efficient manufacturing process and a healthy supply chain.
OFS invoice factoring can provide this liquidity for both the contract manufacturer, AND companies within the supply chain.
We help balance liquidity for events such as:
- Large orders with highly variable revenue recognition
- Mismatch in payment and receivable terms between customers, contractors and suppliers
- Keeping compliant on your delivery terms
- Excess/Obsolete/End of Life Material Management
- Material Inventory Management
- Long lead material items
- Fully burdened production and test labor costs
- Portion of supply chain invoices due prior to receipt of OEM payment
OFS invoice factoring can provide liquidity for both the contract manufacturer, AND companies within the supply chain.