Manufacturing has always been the backbone of industrial growth, driving economies forward. Yet, it hasn’t been a smooth journey. Businesses grappled for decades with various issues related to traditional manufacturing methods. Manufacturing is a complicated, multi-step process. It may be difficult sometimes, and business owners might be forced to depend on other entities to complete tasks. A software solution can help your business to complete this task painlessly. You can outsource the work to small units with an automatic software-assisted system. The Odoo Contract Manufacturing ERP solution can come to your rescue to avoid all complicated contracting procedures and complete the task with a click.

Understanding Odoo Contract Manufacturing

Odoo Contract Manufacturing involves the process where a company outsources the production of parts or products to another company, typically due to cost-efficiency, specialization, or capacity reasons. Odoo, with its comprehensive suite of business applications, offers robust support for contract manufacturing, helping businesses streamline their operations, manage relationships with contractors, and ensure quality control.

A few of the industry examples are mentioned below:

1. Textile unit outsourcing its dyeing and CMT needs
2. Furniture manufacturers or traders outsourcing their orders
3. Electronics Appliances and fans industries
4. Construction & Engineering companies
5. Seed processing & Pesticides companies

Outsourcing a portion or all of your company’s manufacturing needs is not simple and easy. To make it work correctly, you have to: 

• Determine the final product’s cost precisely and efficiently
• Manage your outsourced vendor’s raw material inventory
• Deliver raw materials from your warehouse or another vendor at the right time to your outsourced vendor
• Control the quality of your incoming goods 
• Control outsourced vendor invoices

Key Features of Odoo Contract Manufacturing

Bill of Materials (BOM) Management

In Odoo contract manufacturing, managing the Bill of Materials is crucial. Odoo’s system is adaptable and strong, catering to both basic BOMs for single products and multi-level BOMs for more complex assemblies.

Contracting Process

Contract manufacturing has its feature in Odoo. Companies send semi-finished goods or components to their contractors for further processing. Odoo keeps track of the materials sent, the operations performed, and the final products received.

Manufacturing Orders (MOs)

Manufacturing Orders in Odoo can be created to manage the production process, including when it involves a third-party contractor. The manufacturing order costs are managed, inventory is updated, and progress is monitored by the system.

Supply Chain Integration

The smooth integration of contract manufacturing with other supply chain components is guaranteed by Odoo’s integration capabilities. Odoo facilitates a streamlined process from the procurement of raw materials to the delivery of finished products.

Quality Control

Product quality assurance is essential, particularly in cases where manufacturing is outsourced. Throughout the manufacturing process, Odoo provides quality control points, inspections, and certifications to maintain high standards.

Cost Management

Odoo offers resources to monitor and control contract manufacturing expenses. This helps businesses stay profitable by covering labor, supplies, transportation, and other overheads.

Inventory Management

The manufacturing and contracting modules of Odoo work closely with the inventory module to guarantee optimal inventory levels. Work-in-progress (WIP), finished goods, and raw materials are tracked as they are relocated between the company and its contractors.

Traceability

Odoo ensures full traceability of products throughout the manufacturing process. This is important in industries where compliance and regulations are strict, such as automotive or pharmaceuticals.

Vendor Management

Managing relationships with contractors is crucial in contract manufacturing. The vendor management features of Odoo assist with contract management, performance monitoring, and database maintenance for contractors.

Reporting and Analytics

Comprehensive reporting and analytics tools are available from Odoo to track the efficacy and efficiency of contract manufacturing. Businesses can generate reports on production costs, lead times, quality metrics, and more.

Benefits of Using Odoo for Contract Manufacturing

Cost-Effective: By streamlining the resources and procedures used in contract manufacturing, Odoo helps businesses cut overhead costs.

Enhanced Collaboration: The platform enables better collaboration between businesses and their contractors, ensuring smooth operations and timely deliveries.

Efficiency: Odoo reduces manual labor and errors by automating and integrating the entire manufacturing process.

Flexibility: Odoo’s modular structure allows businesses to customize the system to fit their specific needs in contract manufacturing.

Scalability: Odoo scales to meet the demands of contract manufacturing for both small and large businesses as they grow.

Bista Solutions | Your Odoo Contract Manufacturing ERP Partner

Bista Solutions is a distinguished Odoo Gold Partner and has been recognized as the Odoo Best Partner in North America for several years, including 2023, 2022, 2021, 2018, 2016, and 2015. Bista Solutions offers a flexible and comprehensive ERP solution tailored specifically for the contract manufacturing industry. This allows you to deliver your products—even in large quantities—to distributors and customers more quickly than ever before, optimize your supply chain, and realize significant efficiencies. This is all made possible by a single, integrated system that was designed with your industry’s unique requirements in mind.

Contact Bista Solutions to learn how our tailored Odoo ERP solutions can improve efficiency and profitability in your Contract Manufacturing. Our team is ready to show you a demo and assist you with any questions you may have. Contact Us Today!