When determining EMS manufacturing profit margins for SMT and printed circuit board (PCB) assembly, contract electronics solutions providers will quote OEM prospects the contract manufacturer’s labor and assembly price with labor margin, material pricing (also with material margin) plus, total cost extended, in addition to total margin.
For more detail, with links to supporting EMS manufacturing costs such as indirect labor (IDL) supporting manufacturing operations, please see our list of typical IDL cost drivers, including reference to location-dependent manufacturing variables for EMS manufacturing plus, OEMs can request our white paper on global, multi-national EMS manufacturing cost drivers here.
Electronics OEMs should note EMS providers will have separate agreements with their components and fab vendors, and distributors.
For more on semiconductor and components pricing for OEM customer of EMS manufacturing (v EMS internal cost), and the details of the relationships between distributors and EMS providers, please see our detailed articles filled with additional information below:
1. Five (5) ways electronics OEMs and EMS manufacturers purchase components from distributors
2. Six (6) steps how semiconductor components vendors get approved on OEM AVLs
As manufacturing supply chains become more sophisticated due to the competitive importance of supply chains between competing manufacturers sourcing and bringing products to market, technology is playing a more prominent role helping OEM and contract manufacturers.
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