There can be several reasons why a company would buy the same product it manufactures from another company. Here are a few possible scenarios:
Scalability and capacity constraints: If a company's manufacturing facilities are operating at full capacity or are unable to meet the increasing demand for its product, it may choose to outsource production to another company. By purchasing the product from an external source, the company can fulfill customer orders and maintain a steady supply without investing in additional infrastructure or resources.
Cost considerations: In some cases, it may be more cost-effective for a company to purchase a product from another manufacturer rather than producing it in-house. Factors such as economies of scale, specialized manufacturing capabilities, or lower labor costs in the external supplier's location can make outsourcing more financially advantageous.
Focus on core competencies: Companies often strive to focus on their core competencies, which are the unique capabilities or expertise that give them a competitive advantage. By outsourcing the production of a product, the company can allocate its resources and attention to activities that align more closely with its core strengths, such as research and development, marketing, or customer service.
Strategic partnerships or collaborations: Companies may engage in strategic partnerships or collaborations with other organizations to leverage their expertise, technology, or distribution networks. In such cases, purchasing the product from the partner company allows the company to benefit from the partner's specialized knowledge or resources while maintaining control over its own brand and customer relationships.
Temporary shortages or supply chain disruptions: If a company experiences temporary shortages of raw materials, components, or production capabilities, it may purchase the product from an external source to meet immediate demand while resolving the supply chain issue. This approach helps to maintain customer satisfaction and prevent delays in product delivery.
It's important to note that the decision to buy a product from another manufacturer is based on various factors that are specific to each company's situation, including cost considerations, strategic goals, market conditions, and operational capabilities.