Subcontracting is co-operation between two companies under the terms of which the assigner mandates the Subcontractor or assignee to carry out certain tasks associated with the manufacture of accessories or parts of his products, thus introducing a supplement to the production process. In recent years, a rapid evolution has been observed in the relations between Assigner and Subcontractor, transforming them from a Customer-Supplier relationship into a relationship of deeper co-operation and parallel promotion of product development. The Subcontractor is required to make an early entry into the product development cycle with a view to research, plan and in co-operation with the assigner, develop the components for the final product.
This change creates new opportunities for small and medium-sized subcontracting enterprises, exerting a direct influence on them. Initiative, deployment of specialised equipment, high-level technical know-how and quality become powerful tools in the hands of small to medium-sized enterprises, with product development directly dependent on them. Thus, with the age of vertically-organised production now over, the modern organisational tool known as "outsourcing" is implemented by means of co-operation between enterprises, through SUBCONTRACTING.
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