Automation and faster amortization should mean lower costs.
PCB manufacturers often include nonrecurring engineering (NRE) and electrical test (ET) charges in quotes, in addition to the piece price. During my training sessions for board buyers, I am frequently asked how to avoid those charges.
It’s a good question.
When I started in this industry some – ahem – 30 years ago, NRE charges were approximately $100 per conductive layer, meaning a 4-layer PCB was $400; a 6-layer PCB was $600, and so on. Back then, it took a lot of labor hours to create manufacturing files from a piece of original artwork, as nothing was as digital as it is today.
Talk isn’t cheap, but the absence of it could cost you even more.
Throughout my PCB career as a go-between for board buyers and manufacturers, I’ve often heard complaints from buyers that fabricators – domestic and offshore – ask too many engineering questions (EQs) after receiving an order. “Why can’t they just build the board?” buyers say.
This mystifies me. In my view, PCB vendor questions provide valuable feedback. They may indicate the vendor lacks all the required information to build the order. They also tell me the manufacturer is intent on gathering all the data necessary to do the job right.
I’d be more concerned if no EQs came from a vendor. A PCB has over 100 separate required manufacturing processes, almost all of which are unique to each customer. It would be surprising, even alarming, if everything in an order was absolutely clear, with no back-and-forth necessary.
It’s adding unnecessary costs to your supply chain.
Want a more robust and cost-effective supply chain? Shrink it. Remove the expensive middleman. You don’t need to pay a PCB broker a 20 to 40% markup to, basically, relay information from you to overseas vendors.
The truth is the PCB broker business model – where companies buy printed circuit boards from an overseas manufacturer and then resell them to a customer – is outdated. And it’s adding unnecessary costs to your supply chain.
Years ago, brokers were small operations, with perhaps three to five people. And at one time, they did provide a valuable service to their customers, offering lower prices on boards made overseas, while handling all the details of procurement from foreign vendors in what was often a challenging PCB buying cycle.
It’s time for an industry program to train board buyers.
A printed circuit board is unique to every different application or customer, has over one hundred separate required manufacturing processes, and may come from down the street or halfway around the world. In other words, PCB purchasing is a complicated business. The traditional way of board buying can lead to costly mistakes and may expose companies to financial liability.
I am on a mission to fix that.
PCB buying has changed a lot since I started as a salesman in this industry more than 25 years ago. Back then, purchasing departments were larger. Buying was broken down into specific commodities, with buyers assigned to manage only one or, at most, a few of them. Buyers had the time and available resources to be well-versed in their assigned commodities. Many buying teams resided in the very facilities that designed the boards’ products and used the parts.