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September 1997

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Subject:
From:
Jerry Cupples <[log in to unmask]>
Reply To:
TechNet Mail Forum.
Date:
Tue, 16 Sep 1997 18:35:17 -0500
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Raymond Klein said:

>A debate is raging in my company on the cost effectiveness of SMT resistor
>networks (in 14/16 pin gull wing packages) versus individual 0805 SMT chip
>resistors. The cost of the resistors themselves is well in hand but nobody
>seems to know what it costs me (the customer of SMT assembly services) to
>solder a single 0805 resistor on a PWB that has several hundred such parts
>on it. Any help will be appreciated.

We had the same debate here. This is what I said:

We have a surface mount line. It will cost us money (depreciation, mntc,
etc.) whether it runs or not. The overhead burden won't increase or
decrease based on the marginal change of a few compenents per board.

So take a stab at what it costs you to run your line marginally...Maybe
something like $200-300 per hour? (just a wild stab in the dark)

This cost is the labor (direct and tech support) and the supplies, parts,
tooling related to running that line while it makes boards.

If you can get say 6 to 12 Kparts/hr (what you really get in stopwatch
throughput for a real board)

Then, it might be:

$250/hr operating expense
9,000 parts/hr

Ergo, 'bout $0.027 per part. So if you have an SO-16 pullup resistor
network with the equivalent of 15 chip resistors, it might be worth $0.027
x 14 = $0.39 in savings compared to placing 15 discretes. And if it's an 8
resistor network, then half that...

IMO, the resistor network is not a good buy. They want too much (say $0.50)
for the parts, while thin film chip resistors are practically free, and the
res nets limit layout flexibility when the board is placed and routed.

Besides, chip resistors are wonderful little parts which rarely cause me a
problem. They have such a neat regular shape: thin, with nice flat surfaces
to pick. The ideal board for me would have about 1,000 1206 chip resistors.
In my state of dementia, it makes great sense to argue for more chip
resistors as opposed to more SOIC's. This give me a chance to add value
rather than sending that money to some component people.

And consider this, every time you change the 8 easy parts to 1 more
difficult part, your cost per part is going to go up by most measures. I
want my cost per part diluted by plenty of easy, trouble free passives. Go
the other way,you will accelerate the trend toward boards with a few
ridiculously expensive IC's and a bizillion leads which cost $1.00 each to
assemble.

Now you may have accounting types around there who calculate the overhead
cost and the corporate transfer and the G&A and tell you your overhead rate
is 6,000% or so, and you must consider that as part of the cost of
assembling the boards. I have seen estimates that SMT assembly averages
like $0.15 per part in the U.S. This is hard for me to believe, but it may
be true. The true cost comparision involves looking at only cost delta in
the alternate scenario.

Now if your board has terrible space limitations, that's another argument...


regards,


Jerry Cupples
Interphase Corporation
Dallas, TX USA
http://www.iphase.com

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