In rapidly changing and competitive markets, companies have to apply all possible means to stay ahead of the competition. One of these means is to outsource product development to an external party.
There are a lot of reasons why outsourcing product development can be more favourable than in-house development. We are going to explain 7 advantages.
1. Rapidly apply new technologies
The implementation of new technologies requires knowledge and experience. The advantage of outsourcing is that you immediately have high educated developers at your disposal who applied this technology before. They are aware of the newest technical developments and they can help you to respond quickly and appropriately.
2. Save costs in the long and short term
Contrary to outsourcing, companies can also set up their own product development department. This takes a lot of effort, because employees need to be recruited, they have to be educated and also setting up a solid process takes a while. On short term this is a cost item, but also on the long term this will become fixed expenses. For example: personnel costs, infrastructure and tooling will become fixed costs. With outsourcing you only have to deal with the development costs for the product you made a business case for.
3. Stay focused on your core business
Product development can be complex and it takes a lot of attention and energy. Some companies are only efficient in their core business and are less efficient in activities in which they have no experience. Therefore it is wise to outsource the product development, to make sure existing processes and resources stay focused on the core business.
4. Mitigate risk
The development of a certain product brings risks with it. In-house development may involve uncertainties in terms of technical feasibility, expertise and budget. When cooperating with an external development partner, you immediately obtain more knowledge and experience so therefore you can lower or share the risk.
5. Shorter time-to-market
Products are only successful when they are on the market at the right time. The period in which a certain product suits the demands is temporary because the market changes continuously. With a shorter time-to-market you can respond to the market demand easier and faster. An external party most likely has a shorter time-to-market because otherwise you would lose time by hiring your own personnel. Besides that, the external party has already experience with the technology and knowledge of similar projects.
6. More efficient development
Innovative products often require multiple developers from different fields of expertise. For example electronics, mechanics, design, software etc. The advantage of outsourcing is that you can choose a party with a multidisciplinary development team. By doing this, the integration of the different parts can be more efficient and you don’t have to worry about who will be deployed in the process.
Furthermore, you obtain the advantage of scale . Development parties run multiple projects, therefore you can benefit from their end-to-end solutions and modules.
7. New ideas and concepts
When outsourcing, you immediately profit from new talent. With a fresh view they will look into your case without being influenced by company culture or biased thinking. This brings new innovative ideas and creative ways to look at the case. With experience in other industries, solutions can be found that were previously not considered.
We are Meuleman Electronics
Meuleman Electronics has been working with multiple companies and institutions for years. With our multidisciplinary team, we develop smart wireless products in combination with mobile apps and web applications.
If you have any questions or if you are curious what we can do for each other, please contact us!