GlossaryKind of term: Manufacturing termCustomer-supplied material
What is customer-supplied material?
Customer-supplied material, or free-issue material, is stock the customer provides and still owns while you machine it; you supply the work, not the stock.
It can be bar or plate, but also a semi-finished part such as a casting, a forging or a part that has already been through an earlier operation. It falls under the wider notion of customer property, which also covers the customer's fixtures, tooling, gauges and data. You supply the machining; you do not buy the material, so it does not appear as a material line in your price.
What does the standard say about customer-supplied material?
If you work to ISO 9001:2015, clause 8.5.3 sets requirements for property belonging to customers or external providers. You identify, verify, protect and safeguard it while it is under your control. If it is lost, damaged or found unsuitable for use, you report this to the customer and keep a record of what happened. The standard leaves it to you how to organise this. Customers in sectors such as aerospace or medical devices may ask for more through their purchasing terms, such as traceability to the certificate for each heat.
How does customer-supplied material work in practice?
The material line disappears, but goods-in inspection, separate marked storage, paperwork and returning leftover stock all take time that you can price as an item of its own. Agree the raw size beforehand, including clamping allowance, saw cut and bar end, and how many spares are supplied, because you cannot replace scrapped material without the customer: the material and its certificate are theirs. Also settle who bears the cost of scrap, what happens to offcuts and swarf, which certificate comes with the material and what happens if it arrives late or in a different size. A late or different delivery can push out your lead time.
What is customer-supplied material often confused with?
Customer-supplied material is not a bought-in part: you buy a bought-in part yourself and deliver it, while customer material is supplied to you and never becomes yours. A subcontracted operation runs the other way: there your workpiece goes to someone else for one step, here the customer's material comes to you.
Frequently asked questions
Who pays when a part made from customer material is scrapped?
Agree it in the quote or the order beforehand; it also depends on the cause, a machining error or a defect in the material itself. Common arrangements are spare material from the customer, or you write off the machining and the customer the material.
Should I charge less for an order with free-issue material?
The material line drops out, but goods-in, inspection, storage and returning leftover stock take time, which you can price as its own item. Factor in the risk of scrapping material you cannot replace without the customer.
Who owns the offcuts and swarf?
That depends on what you agree; without an agreement the customer will usually assume the material stays theirs. With valuable alloys such as titanium or brass, settle beforehand whether you return, credit or keep offcuts and swarf.