Quality Improvement: The biggest advantage of keeping your production in-house is the continuous learning loop that it offers. This loop makes it possible for your manufacturing team to send feedback to the R&D team during each step of the development cycle, which allows you to see what works and what doesn’t in a time-efficient manner. Having such feedback available immediately then allows you to make improvements on product design, raw materials, process optimizations, and even packaging and delivery while catching issues that may have been overlooked early in development will help you find, control, and eliminate barriers to your product’s evolution.
Cost Tracking: Keeping production in-house as much as you can gives you a full understanding of what it truly costs to manufacture a product from the first to last stages. Having the ability to track every aspect of production from process yield to waste generation to the total costs of raw materials, processing equipment, maintenance, and warehousing gives you a far more complete picture of just what your business costs are
Production Control: In-house manufacturing helps you keep track of variances and scale production and allows you to develop fixes in a timely fashion, which only serves to benefit production control.
Knowledge Protection: As soon as your production steps outside of your door, there’s nothing stopping a third-party manufacturer from acquiring your technology after they’ve produced it on your behalf. They are the ones who directly handle your materials, implement corrections, and develop the processes needed to produce your property. Even if your third-party manufacturers honor your agreements, giving them this much knowledge and power over your product still weakens your advantage over your competitors. Developing and producing in-house keeps your property and knowledge yours and yours alone, which gives you an edge over time.