Rule number 1: Electronics pricing is insane. It follows no logic, rule, or law, and Adam Smith's unseen hand has been cut off at the wrist. Forget everything you learned in economics 101, it was all lies. Example: I had two quotes from two different manufacturers for a complete board, same volume both ways. One mfr quoted the finished, tested board for 10% less than the other mfr's raw component cost. How is this possible in a sane world? Rule Number 2: Tarriffs: All those $10 walkmans are made in China. China imposes huge export duties on components, but not on assemblies (tricky). The raw components are all made there. This makes it cheaper to manufacture a complete walkman in China than to buy the components for it outside China. That's why the lions share of inexpensive electronics is shipped from Hong Kong today. Prices for the same components from the same mfr are often 3/4 or 1/2 in Hong Kong vs US. Sometimes this is because they are made over there (see tarriffs), other times it is simply demand. Why is a 2000 square foot house worth $250,000 in Silicon Valley and $50,000 in Columbia, Missouri? Rule Number 3: Digikey/4: a quick and dirty way to find the real price of anything is to divide the Digikey 100 piece price by four. I kid you not, when I finally get high volume mfrs to reveal their pricing, the rule works pretty well. Don't use rule number 3 for your business plan, though, a banker won't believe you. Keep hammering on big distributors like Future, Arrow, etc. Get their quote, and then say "that's not good enough. I need it for $(digikey / 4)! Simply negotiating with some of these guys will work wonders. Rule number 4: To run with the bulls, hire a bull. You may want to obtain finished board quotes directly from some offshore manufacturers. Don't mess around with production at all, just buy the board complete according to your specs, QC plan, and inspection. Email me offlist if you'd like a few names. -- Lawrence Lile ----- Original Message ----- From: "John Ferrell" To: Sent: Wednesday, July 18, 2001 3:05 PM Subject: Re: [EE]: Secrets to getting best prices on electronics components [including PICs] (production quantities) > There is a condition "economic order point" that comes into play. Selling > your entire production to a single customer poses some special risks. It > does not take long for that customer to control your fate. Selling more than > you can produce with out extraordinary effort can cause manufacturing costs > to skyrocket. > > If you really need that kind of quantity, may be it would be best to acquire > the resources to manufacture them. > > John Ferrell > 6241 Phillippi Rd > Julian NC 27283 > Phone: (336)685-9606 > Dixie Competition Products > NSRCA 479 AMA 4190 W8CCW > "My Competition is Not My Enemy" > > > > ----- Original Message ----- > From: "Sanjay Punjab" > To: > Sent: Wednesday, July 18, 2001 5:15 AM > Subject: [EE]: Secrets to getting best prices on electronics components > [including PICs] (production quantities) > > > > I have developed some new technology for an automotive > > electronics application. > > Part of creating a solid business plan, is to get an > > accurate idea on how much an > > electronics device will cost to build, including cost > > for hardware such as ICs, capacitors etc. > > There however seems to be a few obsticles I am > > encountering. > > 1. Distributors like Digikey, Arrow and others will > > easily provide quotes for up to 10,000 pieces. But > > most distributors won't provide quotes for quantities > > above this. And for my situation, I need quotes for up > > to 1 million pieces per device. It is as if, my > > company is too small to be taken seriously. > > Distributors that WILL provide quotes for up to 1 > > million pieces, > > come back with quotes that are BARELY any cheaper than > > the 10K quotes. Something just doesn't seem right. > > 2. For quantities as high as 1 million, I assumed > > that I can bypass the distributor and talk directly to > > the component manufacturer, such as Microchip, > > National Semiconductor etc. > > However I have the same problem with Manufacturers. > > National Semiconductor for example provides a straight > > quote online for 1000 pieces or above and by > > phone,fax,e-mail , won't provide better quotes for > > quantities as high as a million. > > 3. I just don't get it. I go out to circuit city and > > I see a Walkman for $10, or a Computer mouser for $10 > > and wonder, how they get the price of thing so low, > > considering the quotes I get for many of the > > components I am using. Now I know, some can say, > > these Walkmans are made by large corperations and make > > millions of these a year. But how about those > > realtively low volume electronics devices, like a $40 > > (retail price) Golf Score Keeper device which included > > an LCD display. Some collegues have told me to look > > oversees for the best quotes. Thats fine for common > > devices like capacitors and resistors, made perhaps by > > generic companies. But for components like PIC > > microprocessors, specialised ICs, I just don't see how > > an oversees vendor can get better prices than whats > > offered direct from the manufacturer in the United > > States. > > > > I guess I don't really have a specific question. I > > would just like to get some insight on how electronics > > device makers, find ways to get electronics > > components, including ICs so inexpensively. Perhaps I > > am missing something. > > > > > > __________________________________________________ > > Do You Yahoo!? > > Get personalized email addresses from Yahoo! Mail > > http://personal.mail.yahoo.com/ > > > > -- > > http://www.piclist.com hint: The PICList is archived three different > > ways. See http://www.piclist.com/#archives for details. > > > > > > > > -- > http://www.piclist.com hint: The PICList is archived three different > ways. See http://www.piclist.com/#archives for details. > > -- http://www.piclist.com hint: The PICList is archived three different ways. See http://www.piclist.com/#archives for details.