Manufacturing contract is a basic written agreement to limit a particular product to be manufactured between contract manufacturer and product owner. So does for plastic injection molding project, if you are going to launch your molding project in China, you should always have a comprehensive contract with your molding suppliers. Here below are some typical elements that should be included in your manufacturing contract.
Hit an agreed Lead-time of your project
After discussed with your molding manufacturers, you should finalize a lead-time of your project, which is achievable and measureable. Because the lead-time of your project is very important to your market launch, you should make every effort to hit your lead-time as earlier as possible. Most of time, people would set up a project schedule or plan to make the overall lead-time reality, follow-up and monitor each time zone to move forward.
Make clear cost list on the manufacturing contract
While making a manufacturing contract, you should make a clear cost list on the contract(or you can mark the quotation number in the previous quotation from your supplier), so as to avoid any hided cost that might raise up in future. If you disregard this step, it’s hard to debate any potential price raise up.
In China, there are many different level of manufacturing companies, some of them might be honest to clients whatever you have a clear contract or not, however some of them might not be. Therefore you should make the cost as clear as possible on the manufacturing contract.
List out your critical quality standard and requirement
Since plastic injection molding project is a serous engineering work, we should always define our quality standard and requirement. Some common quality issue of injection molding are as below:
- No obvious flash
- No deformation exists on the part
- No flowing marks on the surface of parts.
- All critical dimensions should be on spec
- No sink mark on outside surface
- Part fitting should be good while assembly test
Put a safe payment terms
The payment terms depends on your project and agreement of your molding supplier, since there are few different payment terms for plastic mold making and injection molding manufacturing. Normally we do 50%+50% for mold making, (some of mold companies do 40%+30%+30%), and 40%+60% for injection molding production. However this terms could be adjustable while the complexity of your project. If a small project with less amount of money, you can do it more, if your project is big, you just need to make just 30% of total amount to kick off the production, and make the rest when the goods is ready to deliver.
Make a outstanding punishment terms if the contract is broken by any of sides
It’s important to write out the punishment terms if the contract is not followed or broken by any of sides. From our experience, you can make a 5%~10% of total amount for punishment if the lead-time is delayed for 10 days above. Meanwhile, you can also make a 5%~30% of money punishment if the product quality is not hit. With these punishment terms, your molding supplier will be more serous towards your project.