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Turnkey Manufacturing

Turnkey manufacturing is a process where everything required for production, from design and prototyping to assembly and shipping, is outsourced and handled by a single point of contact.

This contact acts as project manager for the execution of every stage of the product life-cycle.

Key Takeaways

  • “Plug and play” end-to-end manufacturing solution

  • Outsourcing everything from design to distribution via an expert facilitator

  • Saves costs on equipment and has clearer line of command

What Is Included In Turnkey Manufacturing?

A turnkey manufacturing process includes design, setup, execution, and technical support. In practice, if a manufacturer wanted to opt for a turnkey solution, they would hire a contract manager with networks of reliable workers best for different tasks.

The manager could potentially take care of everything in-house, but it is more common for the manager to outsource different stages of production to the best companies for the job.

Let’s break down the responsibilities of a turnkey project manager even further. The following stages of development are included in the turnkey process:

  • Design and discovery
  • Vendor selection
  • Materials sourcing
  • Prototyping and testing
  • Fabrication and processing
  • Assembly
  • Delivery and distribution

Here's a simple example to help you conceive of the turnkey process: you’re starving, and you’re craving wood-fired neapolitan pizza. The problem is, you don’t have any of the ingredients, equipment, or technical skills to execute on your vision of delicious, authentic pizza.

Sure, you can buy the ingredients from your local grocer and research the best online recipe, but that’s a lot of money, time, and effort spent on a process where you’re not sure you can deliver the exact product you’re imagining.

So you open your preferred food delivery app and order from a local pizzeria. Within an hour, a hot, delicious, wood-fired pizza is in your hands. Success!

The turnkey solution for this example is the food delivery app.

You don’t have to worry about sourcing the correct ingredients and agonizing over the ideal cook temperature because those decisions are made for you by the experienced chefs at the restaurant.

Maybe the pizza is a little pricey, but it’s definitely cheaper than the sunk costs of all the necessary ingredients and equipment required to duplicate the final product.

Lightbulb Pro Tip

Pro Tip

Turnkey is different from your typical contract manufacturer because the latter doesn’t necessarily provide design specs and drawings, only the literal fabrication and assembly of the product in question; turnkey solutions cover the entire process through to customer delivery. To extend the example above, a typical contract manufacturer solution for your pizza needs would be a meal kit subscription service, where the ingredients are sourced and the product specs are included (via a recipe), but you yourself have to fabricate and assemble the final product.

Benefits of Using Turnkey Solutions

While the pizza analogy was helpful at describing the importance of turnkey solutions, it glossed over the tangible benefits to using turnkey solutions in a manufacturing context:

  • Saves time and money spent on vetting contractors
  • Better flow between production and planning stages due to project manager coordinating as a middleman
  • Take advantage of high expertise skills and expensive machinery without investing in or acquiring niche resources at your own plant
  • Enhanced quality control drawn throughout every step of production

Manufacturers of all sizes and industries employ turnkey solutions for different production contracts depending on the required specifications and cost projections.

We provide full integration with VKS Enterprise, our own turnkey solution for manufacturers of all sizes and industries looking to interconnect their digital production processes. Using custom APIs and optional on premises support, VKS is the one-stop solution for lean and continuous improvements in manufacturing.

Tips for Successful Turnkey Manufacturing

Turnkey manufacturing solutions are common methods of delivering quality products while reducing costs. Nonetheless, there are some key aspects that must be considered when assessing the right solution for you.

Research your project managers thoroughly

Turnkey solutions simplify the chain of command and allow for easier communication, but all that is moot if you don’t choose the right person to lead the job. Instead of investigating the quality of your materials sources, shift to investigating the reputation and potential of your project manager or outsourcing facilitator.

Calculate your overhead threshold

Before assuming that a turnkey framework will save you money, calculate a projection for exactly how much you expect to save with a turnkey facilitator in contrast to doing everything in-house. This will help you keep the bottom line clear and also give your manager guidance for how much wiggle room is available for outsourcing options.

Setup a reliable ERP or MES

In order to keep track of important details for quality control, you need to set up an effective ERP or MES to log ongoing data. This database is even more crucial when in a turnkey situation because the suppliers and facilitator are often spread across many locations, and it’s critical to refer to the same data sets.

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