Staying Connected - December 2010

“Re-Shoring” – Moving Manufacturing Back to the U.S.

A significant portion of Affinity’s growth in the past two years has come from our OEM partners bringing manufacturing of medical cable assemblies back to the U.S. from Asia.  This is often referred to as “re-shoring” or “on-shoring.”  The Affinity team calls it good business!

Designing and manufacturing medical cable assemblies, connectors, and interfaces is done worldwide.  With labor costs being less in Latin America and even less in Asia, it may be surprising that domestic manufacturing is increasing as device manufacturers shift production back to the United States.

Price vs. Total Cost

One reason for dissatisfaction with offshore manufacturing is that expected cost savings are often not achieved.  When comparing pricing from offshore manufacturers to those of domestic manufacturers, a number of factors should be considered.  It is generally accepted that there are additional costs when purchasing from offshore manufacturers, but often all of the additional costs are not readily apparent.

Supply Chain Costs and Issues

Anything that decreases the efficiency of the supply chain will add to the true cost of a product.  Added costs due to supply chain inefficiency are often unknown or overlooked when initial pricing is negotiated.

To reduce costs, many of our customers have implemented programs to minimize their investment in inventory.  For such programs to be successful, short lead times and reliable dock dates are required.  With the built-in delay for goods to clear U.S. Customs, shipments from any offshore manufacturer will take longer than from a domestic producer.  And, when sourcing from an Asian manufacturer, you are faced with either high air freight shipping costs or very long surface transit times.

As lead time to receive product increases, so does the need to maintain safety stock or buffer inventory.  Additionally, if there is any uncertainty over an offshore supplier’s ability to meet delivery commitments, even greater inventory may be required.  The cost to hold excess inventory can quickly reduce, or even eliminate, any price advantage of manufacturing offshore.

The Value of Flexibility

It is reasonable to assume that shorter overall lead times offer the advantage of greater flexibility.  Flexibility can be of benefit when:

  • Orders need to be increased
  • Orders need to be decreased or cancelled
  • A product change needs to be implemented
  • A “pull system” is easier to implement

It may be difficult to assign a dollar amount to the value of flexibility in a supply chain, but it is quite clear that increased flexibility reduces total cost.

Quality System and On-site Audits


Valid ISO certification by a recognized body–
an important consideration in supplier selection

An important consideration when choosing a manufacturing partner is their quality system and certifications.  A supplier with ISO certification from a recognized body will be expected to meet minimum common standards.  However, without conducting an on-site audit, the effectiveness of the quality system cannot be fully evaluated and established.

The ability to conveniently conduct initial and follow-up on-site audits may be an important consideration in supplier selection.  An on-site audit is typically easier and more efficient if the supplier to be audited is located in the same country.  Auditing an offshore supplier is typically more costly and takes more time.  Also, the effectiveness of an audit may be reduced due to language differences in both verbal communication and documentation.



Affinity’s Bob Frank helped
author the EC53 standard

Standards and Regulatory Experience Knowledge

A prospective supplier may offer additional value if they have experience and knowledge of recognized standards such as ANSI, AAMI and IEC.  Similarly, experience with regulatory issues associated with the U.S. Food and Drug Administration may be of benefit especially in the design and development stage of a project.  Affinity offers our OEM partners the advantage of being a FDA registered medical device manufacturer as well as having experience obtaining a 510k for cable assemblies.  We understand the challenges of meeting regulatory requirements.

Affinity’s Director of Engineering, Bob Frank, was a member of the AAMI committee that established EC53, the only standard that specifically applies to medical cables.  His intimate knowledge of the standard and how it is applied to medical cables has proven valuable to our OEM partners.



Reducing labor content and
operator dependency begins
at the design stage of a project

Design for Manufacturing –
Reducing Labor Content

Part of any good design process is consideration and planning for how and where the product will be manufactured.  One of the reasons that Affinity successfully competes with offshore suppliers is that our engineering team aggressively “designs the labor out” of the products we manufacture.  Not only does this help us compete on a price basis, but also increases throughput and decreases lead times.  Reduced labor content and improved throughput help Affinity compete on a worldwide basis.


Affinity offers its OEM
partners complete
Design Validation Testing

Design Validation Testing

When choosing between a domestic or international manufacturer, the value of the supplier’s additional capabilities can also be important.  Many OEM’s have gone through restructuring resulting in internal resources being reduced.  A supplier that can write and execute your validation protocol may save a great deal of time and expense.  Few foreign suppliers have the resources and knowledge to assume the validation responsibility.  This is a service that Affinity commonly offers our OEM partners.

Understanding of OEM Partner’s Business

We constantly hear from our OEM partners how important it is that we not only know how to manufacture their products, but also understand their business.  Because we understand their business and how the products we design and manufacture will be used, we are able to offer a much higher level of assistance than off-shore suppliers can.

Affinity’s sole focus is designing and manufacturing medical cables, connectors and interfaces.  Each member of the Affinity management team has several decades’ experience that is applied to providing unique interconnect solutions to our OEM partners.  Understanding how medical cables are intended to be used and how they are typically used, allows us to provide additional value by shortening design time, anticipating potential user problems and therefore reducing risk.

Control of Intellectual Property

Some projects that we participate in are highly confidential and any disclosure details or even the nature of the product could be detrimental to our OEM partner.  Many within the industry have expressed concerns that safeguarding intellectual property may not be viewed with the same degree of importance by offshore suppliers as it is with domestic manufacturers.

Besides the obligations and restrictions included in Non-disclosure and Confidentiality Agreements, we guard our customer’s intellectual property because our reputation and future business depends upon it.



Communicating across a dozen
time zones can be difficult

The “Time Zone Issue”

Collaborating on the design and detailed specifications for a medical cable assembly or custom connector requires regular two-way communication.  Communicating with technical resources in China is particularly problematic because of the nine to twelve hour time difference.  While Asian manufacturers try to minimize the impact of the time difference, communication is often more difficult.

Supply Partner – Not Competitor

An important consideration for medical OEM’s is whether or not a prospective manufacturer competes for their business.  Some suppliers manufacture cable assemblies not only for device manufacturers, but also sell the same or similar products to end-users or distributors.  Competing with our OEM partners is not something that we do at Affinity.  Our sole focus is on helping our OEM partners be successful.

Proud U.S. Manufacturer


New Affinity plant in Costa Mesa, California

Affinity Medical Technologies is proud to manufacture in the United States.

Besides being proud that we manufacture in the U.S, we are very successful at manufacturing domestically.  Our success reinforces our belief that we made the right decision by strengthening our design and manufacturing capabilities here, rather than developing those capabilities offshore.

“Thanks to our customers, Affinity’s business has been strong.  We’ve been hiring for the past two years,” said Manufacturing Manager, Kevin Kom.  “We feel very fortunate to be able to offer good jobs to good people.  And we are all looking forward to moving into our new facility in early February.  We’ll have the room we need to continue to grow our U.S. manufacturing.”

Affinity Asian Partner

For some high volume products with high labor content and locally available raw materials and components, manufacturing in Asia may make sense.  Because a handful of our products fit these parameters, Affinity has an Asian manufacturing partner.  Each of our products manufactured in Asia was first developed, validated and put into production in the U.S.  Only after we have successfully manufactured the product in our Irvine plant have we considered transferring manufacturing to Asia.  When it has made sense to transfer a product to Asia, we have been successful in maintaining the same level of quality, lead times and logistics for our OEM partners.

Balancing Quality, Lead Times and Price

“One of the reasons our business is strong is that many of our new customers have decided to source domestically after experiencing problems sourcing in Asia,” said Affinity Business Development Manager, Hank Mancini.  “There is a saying in the industry that seems to be proving true.  Offshore manufacturers can offer a good price, high quality or fast delivery – pick one.  At Affinity, we do our best to offer our OEM partners all three and it seems to be paying off.  We continue to be awarded new projects that had previously been manufactured offshore.”

Summary

When deciding whether to develop your interconnect project domestically or offshore, it will benefit you to consider all of the advantages and disadvantages of either strategy.  If you have gone offshore and are not enjoying the expected savings or are experiencing service or quality issues, the Affinity team is ready and willing to help.  Contact us at +1 949-477-9495 or at customercare2@affinitymed.com.

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PCB Lead Interface

While the Affinity engineering team takes pride in the custom connectors it has designed, sometimes eliminating a connector is the best option!

Recently an OEM partner asked the Affinity engineering team to design a new interface.  The connection was intended to be semi-permanent, being captured in a case and only designed to be changed when the lead assembly needed to be replaced.


Custom interface designed to
be captured by top and bottom
halves of the device case


A Flexible circuit with a
low-cost pin header plugs
directly into the PCB

An overmolded assembly was designed to be captured and held securely by the top and bottom halves of a plastic case.  Instead of using a pair of connectors the interface was simplified and the cost was reduced by using a small flexible circuit and a pin header.  The four pin connection on the end of the flex circuit is easily plugged directly into the device PCB. 

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Announcements, Information, and Trivia

New Year’s Trivia

Gregorian calendar - Most countries in the world have adopted and use the Gregorian calendar, in which New Year’s Day is celebrated on January first.

Carrying a Suitcase – In Argentina, Bolivia, Mexico and Venezuela those who dream of graveling in the coming year carry a suitcase around the house at midnight.  Those wanting to travel even farther may carry a suitcase around the block?

New Year’s Baby – The tradition of a baby signifying the New Year was started around 600 BC by the Greeks.  To honor Dionysus, the God of Fertility, a baby was carried around in a basket at the start of the New Year.

Hogmanay – Many customs are associated with Hogmany, but the most widespread in Scotland is “first-footing”.  The first person to cross the threshold of a friend or neighbor is said to bring good luck and often brings a gift such as coal, shortbread, whiskey, or fruit cake.

Times Square Ball – Every year over a million people gather in Times Square to watch a Waterford Crystal ball drop.  The ball does not actually drop; rather it descends 77 feet in one minute stopping at the bottom at exactly 12:00 A.M., the start of the New Year.




Suzann Sitka, Cesar Jara and Candy Golding
- the Affinity Customer Care Team

Affinity Customer Care and
Hours of Operation

At Affinity Medical, we don’t have a customer service department.  In place of customer service, we have Customer Care Coordinators.  While our Customer Care Coordinators perform many of the same functions that customer service representative would, we strive to offer our OEM partners more than that.  The job of our Customer Care Coordinators is to take care of our OEM customer partners.

Affinity’s Customer Care team consists of Candy Golding, Suzann Sitka and Cesar Jara.  Candy is the team supervisor and has over twenty years experience working with medical cables.  Suzann Sitka joined Affinity over five years ago.  She has extensive experience, having worked for several medical device manufactures before joining Affinity.  Cesar is the newest member of the team, joining Affinity in mid 2009.

Affinity Medical Technologies Customer Care specialists are available to assist you from 7:00 A.M. until 4:00 P.M., Monday through Friday U.S. Pacific Time, except holidays.