Quantity and Lead Time
Quantity and lead time are important in identifying the estimated PCB assembly services cost. You can’t expect that every piece used in the prototyping stage will be as is during the mass production stage. In the prototype or small batch production, there is a required added engineering cost, such as the costs of processing file, stencil, changing SMT line, etc. As a rule of thumb, when smaller quantity and shorter lead time are requested by the client, the cost per unit is usually higher. In terms of quantity, most manufacturers provide a minimum cost for every order. For instance, if you only need 10 pieces for your project, the minimum order cost will require you to pay 20 pieces. As the quantity increases the cost per board is reduced until the minimum manufacturing cost is achieved. Quantity is a critical factor when identifying the PCB assembly cost drivers. Bulk orders are more efficient for the PCB assembly services providers in offering great discounts as they can increase the production level aside from reducing the product cost. Some manufacturers will provide higher quantity discounts but deliver smaller quantities over time. For example, a 500-piece order may be placed with 100 pieces delivered each month until the order has been completely fulfilled. In this case, the manufacturer achieves manufacturing efficiency by producing all 500 pieces at the same time and the customer achieves cash flow efficiency by only paying for the product that has been delivered. In terms of lead time, the old adage, “Time is money,” rings a bell for PCB assembly services providers. The faster a project needs to be produced means it will be more costly – usually between 30% and 200% more. For a PCB assembly manufacturer, there are real costs involved with prioritizing new projects more than the currently existing task. Some of the costs are reflected in the total pricing.