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Determining the Value-add of Box Build
April 24, 2024 | Nolan Johnson, I-Connect007Estimated reading time: 2 minutes
At a strategic level, adding box-building services makes sense for customer loyalty. But is it really that simple? Jon Schmitz, who manages customer engagement at RiverSide Integrated Solutions, talks about what it really takes to be successful in offering EMS and final assembly services under the same company banner.
Nolan Johnson: Jon, “box build” could mean anything from taking the next step into a larger subassembly to delivering a finished good or even drop shipping from the EMS house. Where does RiverSide Integrated Solutions fit?
Jon Schmitz: In our arena, we do it all. We started with printed circuit board assembly; all our standard EMS provider business is printed circuit board assembly. Then we moved up to product assembly work, and that’s where box build comes in. It may mean putting a circuit board assembly into a housing, like you described, which is a subassembly for our end customer. We send those completed subassemblies to an end customer, which turns it into the finished product. We also have many cases of completing the entire product and shipping it directly into the field. It could be straight to a dealer, or an end consumer.
Johnson: What are some examples of compelling events, trigger events, or crises for a customer that might cause them to go deeper into box-build services with you?
Schmitz: We start with a customer’s need, and ultimately, we offer three main solutions to their needs. First, we have certain customers that want to be virtual. They are not interested in doing any manufacturing themselves and want a manufacturer to do everything for them. That is one of the main reasons we started doing box build and product assembly. Second, we have customers that don't have the internal resources to do this. They may have a labor shortage, or a certain constraint on their business that motivates them to outsource. Third, it may be a core competency issue. We have customers specializing in the final finished product, but they don't want to do any subassembly work outside their core competency. In that case, they may need a contract manufacturer or EMS provider to do that portion for them.
To read this entire article, which appeared in the April 2024 issue of SMT007 Magazine, click here.
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