As Ben Joffe shows in his presentation below, prices of quite a number of consumer products have come down very rapidly. The XiaoMi Yi camera for example equals or bests the GoPro Hero on virtually al…
In Electronic Product Architecture for China Manufacturing component choices define 60% of the cost
60% of the unit cost of a product is decided in the architecture stage, and 20% during the design. As they say at Toyota: ‘‘Skillful improvements at the planning and design stage are ten times more effective that at the manufacturing stage.’’
It is easy to use an on-line database from say Digikey to select all your components, but if you design your electronic product without sufficient knowledge of what China has to offer you are missing a lot of information, making your product needlessly expensive.
Quite a few start-ups base their design on Arduino because it is easy and quick to use. If they then continue to spend a year on optimizing the firmware based on Arduino’s Atmel processor they will lose all that work if they later discover that an STM processor is much more affordable.
And the further you advance in the design process, the more expensive it gets to change something. So if 95% of a product’s design is already prototyped and validated in California, you can hire a really smart China manufacturing consultant, but there is little they can optimize on the unit cost.
Key Technological challenges are weighed against cost effectiveness
We work closely with your team to define the user and functional requirements of the new product, and we determine the key technological challenges. Next our sourcing team evaluates parts from the full spectrum of costs effective components available both in China and elsewhere, so we can deliver the best possible performance within the target cost. To compare and validate the various options we often build rough partial prototypes.
Technical and Economical Feasibility
By the end of this first phase we have a cost effective system architecture with confirmed choices for the main electronic components, and a realistic unit cost estimate. This allows you to confirm both the technical and economical feasibility before we kick of the project in full.