One crucial component for an outsourcing company like TEK LEADERS, that provides outsourcing services in Manufacturing projects, is the cost of labor. Labor remains one of the key component of the manufacturing process, and hence one of the key component with respect to the manufacturing costs.
Huge pros of outsourcing include flexibility of increasing or decreasing staffing needs as required, without directly hiring or firing people. A lower wage is paid to a temporary worker, as compared to one who is more qualified and works fulltime. And also the cost of health benefit expenses is minimal on a temporary worker.
Many companies in the U.S. have outsourced their manufacturing process to get rid of the overhead costs involved in operating a manufacturing facility. These overhead costs include utilities, such as gas, electric and water, and the maintenance required to operate production equipment. Other overhead costs include indirect labor such as quality assurance personnel, equipment technicians, material handlers, and shipping and receiving personnel