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'[EE]: Secrets to getting best prices on electronic'
2001\07\18@052747 by Sanjay Punjab

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I have developed some new technology for an automotive
electronics application.
Part of creating a solid business plan, is to get an
accurate idea on how much an
electronics device will cost to build, including cost
for hardware such as ICs, capacitors etc.
There however seems to be a few obsticles I am
encountering.
 1. Distributors like Digikey, Arrow and others will
easily provide quotes for up to 10,000 pieces. But
most distributors won't provide quotes for quantities
above this. And for my situation, I need quotes for up
to 1 million pieces per device. It is as if,  my
company is too small to be taken seriously.
Distributors that WILL provide quotes for up to 1
million pieces,
come back with quotes that are BARELY any cheaper than
the 10K quotes. Something just doesn't seem right.
2. For quantities as high as 1 million, I assumed
that I can bypass the distributor and talk directly to
the component manufacturer, such as Microchip,
National Semiconductor etc.
However I have the same problem with Manufacturers.
National Semiconductor for example provides a straight
quote online for 1000 pieces or above and by
phone,fax,e-mail , won't provide better quotes for
quantities as high as a million.
3. I just don't get it. I go out to circuit city and
I see a Walkman for $10, or a Computer mouser for $10
and wonder, how they get the price of thing so low,
considering the quotes I get for many of the
components  I am using. Now I know, some can say,
these Walkmans are made by large corperations and make
millions of these a year. But how about those
realtively low volume electronics devices, like a $40
(retail price) Golf Score Keeper device which included
an LCD display.  Some collegues have told me to look
oversees for the best quotes. Thats fine for common
devices like capacitors and resistors, made perhaps by
generic companies. But for components like PIC
microprocessors, specialised ICs, I just don't see how
an oversees vendor can get better prices than whats
offered direct from the manufacturer in the United
States.

I guess I don't really have a specific question. I
would just like to get some insight on how electronics
device makers, find ways to get electronics
components, including ICs so inexpensively.  Perhaps I
am missing something.


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2001\07\18@095412 by Madhu Annapragada

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Sanjay:
       I guess this is where the purchasing managers earn their salary. At my
company, I just pass on the BOM with the manufacturers info and part number
to the purchasing department. They in turn look at the volume projection and
decide whether to go with a distributor or manufacturer direct. The
purchasing guys, I think, have developed key relationships with
manufacturers and distributors that they tap to get the best price breaks.
In your case I am surprised that you did not get any attention for a volume
as high as 1 million pieces...I would imagine the manufacturer would have at
least some interest in this...
Well, to answer your question, is there an engineering contact you can talk
to and get to the sales contact in a company...sort of the back door
approach I guess...maybe online is not the best way to do high volume
purchasing.
Good luck though
Madhu

{Original Message removed}

2001\07\18@104947 by Bob Barr

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>I guess I don't really have a specific question. I
>would just like to get some insight on how electronics
>device makers, find ways to get electronics
>components, including ICs so inexpensively.  Perhaps I
>am missing something.
>

The key to getting the attention of most reps and manufacturers' sale people
is credibility.

A personal contact who has an existing relationship to a company probably
has the best credibility. The purchasing guy at a company I work with is on
a first-name basis with dozens of reps and inside-sales people. His track
record with them, built over many years, has established him as someone who
buys in quantity.

How are you contacting these companies? A letter on company letterhead
carries more credibility that an email from a yahoo account. (No offense
intended. I use hotmail for personal stuff myself, but never for business
use.)

Good luck, Bob
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2001\07\18@160742 by John Ferrell

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There is a condition "economic order point" that comes into play. Selling
your entire production to a single customer poses some special risks. It
does not take long for that customer to control your fate. Selling more than
you can produce with out extraordinary effort can cause manufacturing costs
to skyrocket.

If you really need that kind of quantity, may be it would be best to acquire
the resources to manufacture them.

John Ferrell
6241 Phillippi Rd
Julian NC 27283
Phone: (336)685-9606
Dixie Competition Products
NSRCA 479 AMA 4190  W8CCW
"My Competition is Not My Enemy"



{Original Message removed}

2001\07\18@163342 by Dale Botkin

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On Wed, 18 Jul 2001, John Ferrell wrote:

> There is a condition "economic order point" that comes into play. Selling
> your entire production to a single customer poses some special risks. It
> does not take long for that customer to control your fate. Selling more than
> you can produce with out extraordinary effort can cause manufacturing costs
> to skyrocket.
>
> If you really need that kind of quantity, may be it would be best to acquire
> the resources to manufacture them.

If I need a million resistors, SMT transistors, bridge rectifiers and
PIC12C508 for a production run, it's not exactly cost effective for me to
manufacture them.  I think the original poster was looking for large
quantities of components.  A million parts is nothing special to large
producers.  Of course I only wish I had to source parts for a millon
units...  8-)

Dale
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On my desk I have a workstation...

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2001\07\18@165541 by Spehro Pefhany

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At 03:41 PM 7/18/01 -0500, you wrote:

>If I need a million resistors, SMT transistors, bridge rectifiers and
>PIC12C508 for a production run, it's not exactly cost effective for me to
>manufacture them.  I think the original poster was looking for large
>quantities of components.  A million parts is nothing special to large
>producers.  Of course I only wish I had to source parts for a millon
>units...  8-)

A contract manufacturer will be able to tell you what the cost will be
better than trying to poke around by e-mail. As someone else said, you
need credibility before anyone is going to go to the factory and
negotiate real prices for you. A good PA will cost less than 10% of
what they purchase and will save more than that (but PA's are also the
most common employee to be taking secret commissions). A million resistors
is not many $$, really, but a million ARM chips is a big deal. Sometimes
there are structural differences between markets, semiconductors may
be cheaper in one market than another, even from the same manufacturer.

If you really have enough money to consider making even 100,000 pieces,
the pieces will fall into place when you start talking to people who
know their business.

Best regards,
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2001\07\18@181224 by Lawrence Lile

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Rule number 1:  Electronics pricing is insane.  It follows no logic, rule,
or law, and Adam Smith's unseen hand has been cut off at the wrist.  Forget
everything you learned in economics 101, it was all lies.

   Example:  I had two quotes from two different manufacturers for a
complete board, same volume both ways.  One mfr quoted the finished, tested
board for 10% less than the other mfr's raw component cost.  How is this
possible in a sane world?

Rule Number 2:  Tarriffs:  All those $10 walkmans are made in China.  China
imposes huge export duties on components, but not on assemblies  (tricky).
The raw components are all made there. This makes it cheaper to manufacture
a complete walkman in China than to buy the components for it outside China.
That's why the lions share of inexpensive electronics is shipped from Hong
Kong today.

Prices for the same components from the same mfr are often 3/4 or 1/2 in
Hong Kong vs US.  Sometimes this is because they are made over there (see
tarriffs), other times it is simply demand.  Why is a 2000 square foot house
worth $250,000 in Silicon Valley and $50,000 in Columbia, Missouri?

Rule Number 3: Digikey/4:   a quick and dirty way to find the real price of
anything is to divide the Digikey 100 piece price by four.  I kid you not,
when I finally get high volume mfrs to reveal their pricing, the rule works
pretty well.

Don't use rule number 3 for your business plan, though, a banker won't
believe you.  Keep hammering on big distributors like Future, Arrow, etc.
Get their quote, and then say "that's not good enough.  I need it for
$(digikey / 4)!  Simply negotiating with some of these guys will work
wonders.

Rule number 4:  To run with the bulls, hire  a bull.  You may want to obtain
finished board quotes directly from some offshore manufacturers.  Don't mess
around with production at all, just buy the board complete according to your
specs, QC plan, and inspection.    Email me offlist if you'd like a few
names.


-- Lawrence Lile

{Original Message removed}

2001\07\19@013910 by Peter Crowcroft

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1. If you want electronic components, PCBs PCB assembly over 10,000 pieces
then the answer is simple - CHINA.

Where is most electronic stuff assembled? China.

Where do most electronic components come from? China. (Yes, even thought
they might have Taiwan ot Japan on them the bottom line, China.)

I have just had my Kit 122 Atmel AVR programmer assembled and tested in
southern China. I delivered all PCBs and components to an office in Hong
Kong. Two weeks later they came back. Cost was $HK2.00 each or $US0.26
each. I had 150 pieces done.


2. The downside for a USA-based business that has never visited Asia is 'Do
you trust them?'  Well a part answer is go through me.  I am currently
arranging assembly of 14,000 PCBs for a company. They just have to trust me
that I can do it.

You should make sure you visit the HK Electronics Show (allow 6 days - 3 at
the show and 3 visiting factories in China) in October and make your own
direct links and contacts. Then if you want 20K ecaps buy them direct -
just like the big boys do. There really is no secret. It is trivially easy
to do.
regards,

Peter Crowcroft
           DIY Electronics (HK) Ltd
     PO Box 88458, Sham Shui Po, Hong Kong
Voice: 852-2720 0255   Fax: 852-2725 0610
Web:  http://kitsrus.com     Email: .....peterKILLspamspam@spam@kitsrus.com
   Number One in Electronic Kits Worldwide
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2001\07\19@061419 by nrad Labuschagne

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Ok, so who's got the secret to where to get some stepper motors? I need
about 50 motors, 12V-24V unipolar, and they can be of the cheap metal can
type, and they don't need to have gears or anything special on the spindle.
Anything from 1.8deg/step up to 7.5deg/step will be fine.

I need this source to be able to supply more in the future, otherwise I
would have used my private from home.

Any help or info on this will be highly appreciated.

Conrad

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2001\07\19@071536 by Ashley Roll

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You could try http://www.globalsources.com/

Lots of manufactures of just about anything.. Minimum order quantity may be
a problem though..

Ash.

> {Original Message removed}

2001\07\19@075850 by Roman Black

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Conrad Labuschagne wrote:
>
> Ok, so who's got the secret to where to get some stepper motors? I need
> about 50 motors, 12V-24V unipolar, and they can be of the cheap metal can
> type, and they don't need to have gears or anything special on the spindle.
> Anything from 1.8deg/step up to 7.5deg/step will be fine.
>
> I need this source to be able to supply more in the future, otherwise I
> would have used my private from home.


Hi Conrad, try:
http://www.futurebots.com/motor.htm

They have some good value surplus motors in 23 frame
and 17 frame.
-Roman

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2001\07\19@094613 by Quentin

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Conrad
For local, try Microdyne
http://www.microdyne.co.za
But I guess it could be pricy.

Quentin

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