Use it before you ever talk to a factory. Design for manufacturability (DFM) is the formal process of creating a product that is easy and economical to produce. Too many entrepreneurs just send a design to a manufacturer and ask, "Can you make this?" The factory says yes, but they won't tell you that it will be inefficient, expensive, or have high defect rate. DFM is how you avoid this trap by proactively simplifying the design to reduce material waste, assembly time, and potential for errors before committing to a production run.
The most important thing to know is that you don’t have to be an industrial designer yourself. As John DeBlondo of Gembah explained on The Smartest Amazon Seller, the goal is to move from basic private labeling to becoming a real product innovator. The way you do that is by working with an engineering firm or a specialized freelancer. They take your concept and turn it into a professional CAD file or "tech pack" with DFM already considered. This is what prevents the "learnings from hidden 6-figure manufacturing costs" that a Shopify Masters episode detailed. It's a non-negotiable step for anyone serious about creating proprietary products and protecting their intellectual property.