Product Molds & Tooling Management 

We can say that the product molds & Tooling management have not received the attention it deserves in most companies’ procurement management.

Under normal circumstances, customers are in a strong position and will require suppliers to develop molds and tooling for free. In fact, when quoting products, suppliers will consider allocating the cost of the molds and tooling to the unit price of the product. The buyer’s seemingly clever approach hides huge risks.

Because the ownership of molds developed by the supplier for free is usually owned by the supplier, without ownership and disposal rights of the molds and tooling, this would lead to great potential supply risks.

Supply Risk Because of Without Ownership And Disposal Rights Of The Molds And Tooling 

The molds & tooling development cycle time and verification cycle time are relatively long, if the supplier stop or break down the production for some Unpredictable reasons, the molds and tooling will be a huge challenge issue for switching to a new supplier, because buyers do not have the ownership and disposal rights of molds and tooling, and will face the situation where new molds have to be redeveloped, resulting in significant cost and risk of supplier switching.

Supplier can use the same molds and tooling manufactures the products for your competitors once buyer stop the cooperation with the supplier.

Buyer cannot involve in the management of molds and tooling, including monitoring molds and tooling lifetime, capacity and replacement planning…]

Totally Controlled The Ownership And Disposal Rights Of The Molds And Tooling 

So for the companies with leading Strategic sourcing and procurement management always try to gain the ownership and disposal rights of molds and tooling and keep the molds and tooling in a fully controllable state.

The Right Process For Molds And Tooling Management 

Take the Molds and tooling budget into company business plan

Molds and tooling cost evaluation

Independent purchasing contract to acquire the ownership and disposal rights of molds and tooling

Sign a Contract Of Loan to loan the molds & tooling to supplier for manufacture specific products.

in the contract of loan states clearly the ownership and disposal rights of molds and tooling:

Ownership and disposal rights

Monitoring tool lifetime,capacity

Maintenance, damages

Replacement

Protection of ownership

Safety, accident prevention

Intellectual Property Protection

Molds and tools scrap

…

Contract Of Loan to loan the molds & tooling to supplier for manufacture specific products.

Totally Controlled The Ownership And Disposal Rights Of The Molds And Tooling

Cost and budget are controllable for the molds and tooling

Molds and tooling under control to reduce supply risk

Intellectual Property Protection

…