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How Important Is It To Be Present Where My Product is Manufactured?

For a hardware startup, nothing beats that magical moment when finished product starts to roll off the assembly line.

The Highway1 class is currently in China on a week of factory tours to see and learn firsthand about manufacturing, expanding on the tour of Bay Area factories earlier in the program. Why do we believe it’s important for the startups to visit factories?

We turned to Highway1 mentor Bunnie Huang with the following question:

How important is it to be present where my product is manufactured?

bunnie’s answer:

The answer is “absolutely critical,” at least during the ramp, and ideally for periodic check-ins to maintain quality and reduce cost.

Unless you’re doing something completely trivial and undifferentiated, there’s going to be some process development required for your product. A lot can be done in writing, but many assembly processes are extremely difficult to communicate. Anyone who’s encountered frustration puzzling over an Ikea assembly guide has only hit the tip of the iceberg: Ikea furniture has been vetted and designed explicitly for ease of customer assembly, and your consumer electronics product is most definitely more complicated than a piece of Ikea furniture.

Sending samples is expensive and slow. FedEx is great, but a full sample loop takes around two weeks to complete. The promise is “the world overnight,” but think about it: factory pack, ship, receive; you evaluate, re-pack, return ship, factory receives. The theoretical minimum time to complete the flight loop alone is the better part of a week, but once you add in pickup cutoffs and customs delays, I’ve rarely seen the loop finished in less than two weeks.

If every sample modification takes two weeks to process, you’re adding months to your schedule. Contrast this to being able hop in a car or plane in the morning and arrive in the factory before closing time that afternoon.

“You can get on the line, instruct the operators, and complete several iterations in a single day; you've compressed months of aggravation into a single-day trip. ”

bunnie huang, Hacker & Manufacturing Expert

The corollary to being near your factory is something I call “threat of presence.” Once you’ve actually pulled off the trick of being at the factory’s doorstep the same day an email was sent informing you of an issue, they know you’re going to be on them. As a result, you get de facto priority handling when problems come up, even over bigger customers with more money but who are farther away. The bigger (but farther away) customer is a couple weeks away from being a problem. But you could be the problem that makes the boss late for dinner today. Which one is the line manager going to worry about first?

In conclusion, commit yourself to being within a day’s commute during ramp. It’s a three-hour plane ride from Singapore to Shenzhen; that’s close enough for me, and during major product ramps, I’ll book a few days in a hotel near the factory just to make sure everything goes smoothly.

For further reading, check out bunnie’s blog and order a copy of his new book, The Essential Guide to Electronics in Shenzhen.

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Highway1, a division of PCH, is the premier hardware startup accelerator, located in San Francisco. We look for great hardware startups, with an exciting business idea and a compelling prototype. We help you design products that deliver real value to customers, that are delightful to use and that can be manufactured at scale.
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