Ukraine war fuels procurement crisis: FACTUREE online manufacturing shows advantages over contract manufacturing

Local industrial companies are watching the Russia-Ukraine conflict with concern. The war has already had a negative impact on international supply chains, prices and procurement processes. As a result, many industrial buyers have had to rethink their strategies. With its Online Manufacturing concept, FACTUREE helps to overcome difficulties in procuring materials.

Compared with conventional contract manufacturing, the risk of delays and non-deliveries is much lower because the Online Manufacturer can adapt more quickly to new circumstances, thus minimizing supply bottlenecks.

German industrial companies have been coping with procurement problems for several months. The situation is now intensifying considerably due to the Russian war in Ukraine. The demand for custom-made parts is consistently high, but the sanctions against Russia threaten trade movements. Free capacities and raw material are often in short supply. At the same time, prices are increasing, accelerating inflation.

Change of strategy towards alternative procurement routes

Especially for traditional procurement processes through conventional contract manufacturing, huge disadvantages such as supplier dependencies and interruptions in supply routes have now emerged. In many manufacturing companies, this has led to a change in strategy – diverting to alternative procurement and sales markets. Companies are also looking closer at substitutes for raw and other materials. Furthermore, more efficient manufacturing processes are being explored. One aim of these efforts is to reduce dependency on Russia, Ukraine and other countries as well.

Benjamin Schwab, co-founder and CMO of FACTUREE, states, “We have developed an alternative to conventional contract manufacturing to achieve independence. Thanks to some 20,000 partners in our manufacturing network, we can tap into a huge pool of capacities for our orders. This allows us to react to new developments considerably more flexibly and reliably than conventional contract manufacturers.”

FACTUREE’s manufacturing partners are in the areas of CNC machining, sheet metal processing, 3D printing, and surface technology. For each project, FACTUREE uses AI to find the most suitable manufacturer with respect to quality, price, and delivery time. The request process is semi-automatic, thus ensuring fast proposals. The logistics partners of the Online Manufacturer are selected based on factors such as reliable delivery.

Benjamin Schwab says, “Because we are always informed of the capacities of our manufacturing partners, we can distribute or reallocate orders according to the respective requirements. This allows us to adjust our activities relatively quickly to new circumstances, such as trade route restrictions. We generally do not pass on increases in material costs to our customers and adjust the prices only when absolutely necessary.”

Find out more about FACTUREE at facturee.de.