If a contract electronics manufacturing services (EMS) provider wants to win your outsourcing assembly program, the provider will analyze your hardware program sourcing and assembly requirements (costs) before quoting a proposal (price) to perform PCB assembly services for you.
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EMS manufacturers will obtain pricing for sourcing fabs, pricing for ‘A’ items vs B, and C components.
EMS manufacturers look at their bill of materials (BOM) cost, and include the distributor’s BOM cost and, the OEM BOM cost opportunities. (Read more on A vs B,C materials management)
Adding to this, the EMS provider will factor in their materials mark-up, in addition to actual materials prices.
EMS manufacturers will then line-item assembly direct labor costs to determine total labor costs (v price), while also including SG&A costing.
Depending on program length and size (volume), the above final quote pricing will likely be projected across several quarters, with cost (pricing) decreasing as certain volumes and/or time frames are met.
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