I'm still a bit confused by your use of the term "free issue" - which I interpret to mean "customer-supplied product" upon which the supplier performs a value-added process.
In my experience with this sort of activity
- sending machined parts to heat treater or electroplater
or
- sending raw castings to a machinist for finishing to print
there were two primary factors which played into our choice of supplier to perform the activity:
- capability (the ability of the supplier to perform the activity to our specifications)
- capacity (the ability of the supplier to perform the activity within our time window of expectation)
In a Lean environment, there is always a process (sometimes more than one) which has a process time which is fixed and unchangeable. The only way to increase throughput of units per time period through this "bottleneck" process is to increase the number of persons or machines performing the activity.
Part of the planning for a finished product or assembly is to take the two factors (capability and capacity) into account for each component of the finished product. If one supplier does not have the capacity (for any number of reasons, including a corporate decision not to tie up a large portion of capacity into production for any single customer), then the buyer must increase the capacity by changing suppliers or adding more suppliers. Adding multiple suppliers brings another set of factors into play (uniformity and traceabililty of product - especially for critical components which can affect life, health, safety.)
Lean manufacturing environments aren't easy, but they are pretty to behold once they are operating effectively.
From the supplier's viewpoint:
When a customer does not have a steady flow of "customer-supplied" product to operate machinery at prime efficiency to perform the value added process, a supplier has two choices
(with the connivance and acquiescence of the customer):
- Customer enters into a "take or pay" agreement to buy a fixed amount of production capacity from the supplier each month at two different prices: one price for actual use of the machines including labor and wear and tear on the machines and a second price equal to the lost profit for holding the machines and personnel idle for priority use on the customer's products (see comment below)
or
- Customer agrees to buy a minimum amount of finished product per time period and agrees to pay a slight premium for peak flows exceeding that minimum in any given time period. The premium pays for getting priority use of the machines over any other customer of the supplier to meet the subject customer's demand. (see comment below)
Comments: In actual use, the supplier is willing to grant customer a concession to perform work on customer's product with priority over any other customer for two reasons: first, he is assured of a minimum income each time period which he can use to budget his operation and second, because he is compensated for delaying work for other customers to perform priority work on the subject customer's peak demand.
This does not violate the principle of Lean and may, in fact, enhance it, because the customer is justified in paying more to have a guaranteed supply per time period and increased demand in a given time period
(resulting in higher payment to supplier per unit) can be offset by corresponding lower costs of overhead per item when more pieces are sold in that time period.