What is the difference between Direct and Indirect product?

[km2red]

OK...stupid question. What is the difference between Direct and Indirect product?

[Marc]

What's the context and what's the document?

[km2red]

I work for a tier 1 supplier. We ship product to a packaging company who then packages the product to customer specifications, and then ships it to our final customer. The questions was is what we are shipping to the packaging company indirect or direct material?

[Marc]

You're on a fence there. Technically packaging is an outsourced process AND they're doing the shipping as well. I would say your product is a Direct Product by most definitions. I certainly could be wrong here so other opinions are invited.

By the way, what document is this in?

[km2red]

I'm not sure. I was just asked what catagory I thought it fit in. I think the original question came from sales when they requested a copy of the packaging peoples QS certificate (which they have).

I'm still not sure what the difference is...what makes them a direct supplier?

[Jim Biz]

I may also be wrong on this but --- I've always view Direct /Indirect PRODUCT in the same light as intended/un-intended

If the product you are supplying is the "intended" result of the contracted process - it is Direct.

If the product is not the origional Intended item - (IE selling scrap steel pieces for re-processing) then it is indirect product.

"Packaging - items (IE boxes/materials possible used for other applications after delivery would be indirect products)

What we may be trying to determine more here is "Direct DELIVERY - vs indirect DELIVERY ??

[km2red]

What the deal is....

We make a componant for a car (axles...) we then send this part to a supplier who does the final packaging.

The question was do we consider the axle a direct or indirect product when we send it to the packaging company.

From what I can gather...the riding the fence comment was correct...It is the final PRODUCT (they don't modify the actual axle in any way), but the packaging is a customer requirement, so technically, without the product being packaged correctly, the product would not be complete and would be non-conforming/not accepted...

My answer (aka: guess) was direct product, because they don't actually make any modifications to the axle itself.

Thanks for the "intended vs. un-intended" analogy...that makes it a bit clearer

This may be way to simplistic, but a company supplies a product to a customer. The customer says the packaging is bad. Will the company go after the "subcontractor" that packaged the product or the company that is the supplier?

I guess I'm saying, does it really matter, you are the supplier and therefore the scapegoat. It's called business, and they probably don't teach it in school.

Was this possible situation run through the Product Realization/FMEA/Control Plan process?