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How to Cost Your Product Properly (Design-to-Cost Explained) with Paul Adams [Podcast]

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By the time some manufacturers realize the full cost picture of their new product, fixing it is expensive, and sometimes too late.

In episode 323, we break down how product costing really works. You’ll see the key cost drivers, where mistakes typically happen, and how to approach design-to-cost early enough to stay in control.

If you’re developing a product, this will help you avoid the common traps and make better decisions before committing to production.

Listen here

Listen to the episode or watch on YouTube

Episode Sections:

  • 00:00:12 — What Is Design-to-Cost?
  • 00:00:49 — Why Costing Is Often Overlooked
  • 00:01:55 — The 4 Core Cost Drivers (BOM, NRE, Tooling, Logistics)
  • 00:05:24 — Value Engineering & Smarter Design Decisions
  • 00:08:54 — Reducing Assembly Cost & Complexity
  • 00:10:10 — Supplier Strategy: Cost vs Quality Trade-offs
  • 00:12:20 — Tooling Costs & Budget Pitfalls
  • 00:15:04 — NRE Explained: Hidden One-Time Costs
  • 00:19:40 — Logistics: The Most Underestimated Cost
  • 00:22:52 — Design for Cost: How to Reduce Product Cost
  • 00:28:08 — Why You Must Think About Cost Early
  • 00:31:47 — Biggest Costing Mistakes to Avoid

Further content

🎧 Listen, rate, & subscribe to the ‘China Manufacturing Decoded’ podcast on your favorite provider

More episodes are on the way, so remember to rate us and subscribe! You can find us on:

Cost Vs Quality – How Manufacturers Can Find A Balance [Podcast]

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Adrian and Renaud tackle the big question of cost versus quality and how they both affect each other in manufacturing. You’ll learn common Chinese attitudes towards them, the long-term power of lean, and some achievable levers that can bring you cost and quality benefits that most businesses can implement quickly.

 

Listen to the episode here 👇

Listen: to the podcast episode

Watch: on Youtube

 

Episode sections

  • 00:00 – Greetings and introduction (inc. our team at CES ’24!)
  • 01:50 – What do we mean by Cost V Quality?
  • 04:49 – A typical Chinese manufacturer’s logic about quality.
  • 15:29 – The Lean manufacturing ideal.
  • 25:32 – Day-to-day keys that can give you quality and cost benefits. 
    • 26:38 – Do design for manufacturing and assembly
    • 29:30 – Follow a sound NPI process
    • 32:57 – Use good tooling and automation
    • 35:12 – Staff training for avoiding defects and more
    • 37:21 – Experience effects
  • 38:21 – Wrapping up.

 

Related content…

 

Listen, rate, & subscribe to the ‘China Manufacturing Decoded’ podcast on your favorite provider

More episodes are coming, so remember to rate us and subscribe! You can find us on:

If you enjoyed this episode, don’t forget to give us a 5* rating and share it with your network if you enjoy listening!

9 Questions You Need Answers To When Developing A New Product (Part 2)

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9 Questions You Need Answers To When Developing A New Product (Part 2)

Sofeast’s CEO Renaud completes part 2 of his journey through 9 of the key questions businesses who’re developing new products commonly need answers to. Here’s part 2 of the podcast covering questions 5-9…(by the way, you can catch up on part 1 here).

 

Listen to the episode here 👇

Listen: to the podcast episode

Watch: on Youtube

 

Episode sections

  • 00:00 – Greetings and introduction.
  • 01:07 – 5. What is the product’s production cost?
  • 19:24 – 6. What’s the pricing strategy for the product?
  • 28:59 – 7. What is the distribution strategy?
  • 37:52 – 8. What will the timeline for developing & launching be?
  • 48:46 – 9. What are the risks of launching this product?
  • 51:35 – Wrapping up.

 

Related content…

 

Listen, rate, & subscribe to the ‘China Manufacturing Decoded’ podcast on your favorite provider

More episodes are coming, so remember to rate us and subscribe! You can find us on:

If you enjoyed this episode, don’t forget to give us a 5* rating and share it with your network if you enjoy listening!

9 Cost-Cutting Measures Importers Will Love! [Podcast]

Posted on by sofeast

9 Cost-Cutting Measures Importers Will Love!Renaud and Adrian cover a topic that most importers, regardless of where they are manufacturing in the world, will value: cost-cutting!

There are 9 measures you could use to reduce your business costs here ranging from fairly low-hanging fruit, such as adjusting which product inspections and laboratory tests you perform (maybe you can actually get away with fewer or by focussing on a different kind at a different stage of production) to larger projects such as near-shoring your production in order to escape higher manufacturing costs, tariffs, and lead times due to distance.

There’s something for everyone here, so get started by listening below, and we hope you find a way to trim your own costs!

 

Listen here!

Listen: 9 Ways Importers Can Save Money

Watch: On YouTube

 

Episode sections

  • 00:00 – Greetings.
  • 00:41 – Pre-chat: Our team member’s story when she ended up in a quarantine hospital in China.
    This episode can be heard here and real photos of the conditions are included: Travel To China In 2022 – Don’t Test Positive!
  • 02:48 – Today’s topic: 9 Ways for importers to save money.
  • 03:29 – 1. Avoid big problems on the manufacturing & transportation side.
  • 08:18 – 2. Avoid big problems on the distribution side.
  • 14:04 – 3. Re-engineer your products.
  • 21:42 – 4. Place larger orders with fewer key suppliers to benefit from lower pricing.
  • 23:17 – 5. Use competition among your suppliers to drive down prices.
  • 26:08 – 6. Avoid buying via a trading company if they don’t add value that warrants the extra cost (in most cases).
  • 29:49 – 7. Relocate manufacturing.
  • 31:51 – 8. Internalize manufacturing (DIY).
  • 36:21 – 9. Spend money more wisely on inspections, testing, etc.
  • 41:35 – Wrapping up.

 

Related content…

 

Listen, rate, & subscribe to the ‘China Manufacturing Decoded’ podcast on your favorite provider

More episodes are coming, so remember to rate us and subscribe! You can find us on:

If you enjoyed this episode, don’t forget to give us a 5* rating and share it with your network if you enjoy listening!

How to Calculate the Cash Needed to Prototype & Launch your New Product [Podcast]

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How to Calculate the Cash Needed to Prototype & Launch your New ProductSofeast’s CEO Renaud Anjoran and Adrian kick off the episode by talking about Hong Kong’s new and improved immigration and Covid procedures and the heatwaves and droughts in China that have been affecting manufacturing there.

The main topic is learning how to calculate the key costs you need to know in order to successfully launch your new product. What investment will you need to get it developed and made? What will the cost per unit be by the time you’ve imported it? What will your selling price be? Renaud answers these questions for you and provides a breakdown of items and activities that make up each cost.

 

Listen here!

Listen: Calculating the Cash Needed to Prototype and Launch your New Product

Watch: Video on YouTube

 

Episode sections

  • 00:00 – Greetings.
  • 00:37 – How visiting Hong Kong in August 2022 has become easier.
  • 04:20 – What effects are the heatwave and drought in China, especially in the Western provinces of Sichuan and Chongqing, having on manufacturing?
  • 09:13 – The psychological side of launching a new product and how ambition affects a product launch.
  • 14:46 – What are the finance numbers involved?
  • 22:59 – What’s included in these costs? (action & item breakdown)
  • 32:39 – Why do many products end up being sold at a loss?
  • 35:06 – Other ‘hidden issues’ that don’t always show up in the calculations.
  • 37:39 – In summary.

 

Related content…

 

Listen, rate, & subscribe to the ‘China Manufacturing Decoded’ podcast on your favorite provider

There are more episodes to come, so remember to rate us and subscribe! You can find us on:

If you enjoyed this episode, don’t forget to give us a 5* rating and share it with your network if you enjoy listening!

Plastic, Silicone, Steel, and Others: Updated China Raw Materials Costs (June ’21)

Posted on by sofeast

If you have been following our posts on the costs of China raw materials this year (2021) you will have seen that the prices have been rising rapidly in some cases.

Add this to the shipping delays and increased logistics costs and it’s becoming an expensive year for importers.

We’re tracking the raw material costs for some key materials and this month’s graph shows that some costs continue to stabilise, albeit at a higher level than before:

china raw material costs june 21

We’ve seen some price drops:

  • Paper (the pulp cost dropped a bit and it is mostly seasonal, as the peak season for packaging in China is before Christmas and before the Mid Autumn Festival)
  • Aluminum alloy. One reason may be the restrictions on electricity consumption and the difficulties in automobile production (due to a shortage of chips)

However, in the main, prices haven’t been moving southward.

The usual suspects have retained big price increases:

  • Batteries (lithium cobalt oxides)
  • Brass (despite a release of stock in the US)
  • Silicone (some people mentioned an accident in a large polycrystalline silicon factory — Hesheng Silicon Industry in Xingjiang — as a cause for lower supply)
  • ABS plastic

 

How to combat the rising costs?

Explore cost-reducing tips in this post: Rising Raw Material Prices: What Strategy To Follow? (6 Approaches).

If you’re purchasing electronic components, you may consider buying up inventory in advance to lock in the best possible price right now, too.

When it comes to electronic components, remember, the ‘best price’ isn’t always the cheapest.

As material costs rise the price you’ll pay is dictated by the market to an extent, but are you sure you can’t find ways to spur your supplier to improve in order to reduce costs elsewhere? For example, reducing quality issues reduces costs and can improve delivery times, too. Listen to this episode of our podcast to learn all about improving suppliers.

If the supplier is a write-off, maybe sourcing a new supplier will help you find one who can offer you better prices and more? If so, there’s no need to fear switching from your current supplier to a new if you’re prepared: How To Switch To A Newer, Better Chinese Manufacturer? [eBook].

 

We hope this is helpful. Our mission at Sofeast is to help importers have transparency in their supply chain and to give them more control. And this information is critical to have some visibility into your manufacturer’s costing.

By the way, you can always contact us if you have any questions about whether a manufacturer’s quote is reasonable.

How To Reduce Manufacturing Costs? The Lean Approach

Posted on by sofeast

How To Reduce Manufacturing Costs? The Lean ApproachThe number one challenge of Chinese suppliers, as revealed by a recent survey, is reducing manufacturing costs. Their costs keep rising, but price competition is stronger and stronger. So how can you reduce costs?

Continue reading “How To Reduce Manufacturing Costs? The Lean Approach”