There is no standardized manner for how contract EMS manufacturers determine pricing of fees they charge for services they provide to OEM customers.
There are many common practices used by EMS providers in industry when revealing (disclosing) quote pricing and fees to OEM decision makers during the RFQ/RFP quote phase, but ‘actual’ EMS internal costs are never revealed or accurately determined.
One of the big challenges OEM companies face when negotiating EMS contractual pricing to better control product manufacturing costs in EMS factories is determining (discovery) the actual, internal costs incurred by EMS manufacturers to execute your OEM program.
Advanced costing mirrors EMS industry logic
Our EMS manufacturing cost modelers capture the trends in EMS manufacturing pricing of services and, mirror the EMS business environment in which EMS manufacturers make their pricing decisions.
And because we do this better, and more accurately, than EMS manufacturers are capable of doing themselves, we help OEMs identify opportunities and get you on the right side thus allowing you to negotiate EMS program pricing, fees and cost reductions from a position of strength.
Contrary to what many EMS industry professionals may claim, many do not understand that EMS pricing of fees does not come out of a vacuum. There are many extraneous factors, important factors. EMS firms may look at these factors but do not know how to assign weights and values.
This is critical and one of the most important aspects when determining EMS internal costs and associated risks.
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