Is it worth to assembly boards for low volume lots?

Question

I'm planning to sell boards I designed but I will start in low volume lots (50 to 100 boards). I 'm seeing if its feasible to assembly the boards ourselves, using SMD stencils and reflow oven. I was reading a lot and it seems quite interesting. Now, my question is considering the boards are simple (4" x 2" PCB, 2 48-pin LQFP chips,1 SOIT16 chip, 2 USB connectors, 1 DB9 connector, and less than 30 caps and resistors), would it be worth to do the assembly from the cost perspective? I know I can get very low prices in China (or any other place) but I guess I will need to run higher volumes (I guess 1000 or more boards), and I will also need the investment to support that...(components and labor).

My point is not really try to get much lower assemblies costs in this way, but not have to invest that money in such large quantities. (I will not manufacture the PCB boards...Just assemble them)

I would like to hear someone else's experience in cases like this.

update
Many thanks for your inputs. The board is simple, but the added value comes from the Software (embedded and Desktop). Certainly I expect to sell over 1000 over the time, but I don't want to invest in such lotes of 1000... That's why I will start with 100 until I feel confident with this. Now, having said this, and assuming I would assembly the boards in the US, I would like to know if I could save money or not doing the assembly ourselves. The product itself will give me a profit to cover design, firmware, etc. Now, may I make extra money from the assembly, considering lotes of 100 through companies in the US? If I can save $20 per board in assembly costs I would be more than happy... Is this what they would typically ask for the assembly? I'm not planning to do the assembly myself but relatives that need to work, so I prefer to give them the job and save money at the same time. I hope this makes sense....

Answer 1

You can get lots of 50 or 100 made, but it will be more expensive than lots of 1000 or even just a few 100. Unless you have a previously established relationship with a manufacturer in China, and you are happy with that relationship, I would not try to get your product made there. It takes a lot of time and effort to set something up that you can eventually rely on. It may sound easy, but it's definitely not. Going to China is not cheap unless you know what you are doing, have the time and patience and expertise to invest in getting good manufacturing set up for yourself, and are willing to get personally envolved. I'm sure Russell has a lot to say about this. He has more experience with this than I do.

Frankly, from the little you've said it doesn't sound like your business case makes any sense. This sounds like a fairly simple device. The chance that you have stumbled upon a major need that nobody addresses is quite small. This is therefore a niche product at best. How much are you going to be able to mark up each unit? $20 maybe? That means at best you make $1000 profit on your whole lot of 50 boards. How much time did it take to design the circuit, enter the schematic, lay out and route the board, create the BOM, test the result, write the firmware, etc? Now you're talking about assembling them yourselves, which will include purchasing and kitting. Each one has to be programmed, tested, and possibly calibrated depending on what these things do. Divide $1000 by all the time you have spent and will spend doing the build, and you'll be paying yourself pennies per hour. If you can't see at least 1000 of these things getting sold, this is a waste of time unless you're doing it for the fun, challenge, entertainment, etc. If so, the method of production doesn't make a lot of difference.

Answer 2

They will do it for 1 single board too, but it may cost you as much as the total cost for a hundred boards. There's a fairly high setup cost, but the machines they use are so efficient and flexible that once they're running assembling is almost free. That's how products made by the hundreds of thousands or millions are so cheap. I guesstimate that it starts to be worthwhile starting from 1000 pieces. Smaller runs might be as well, but you'll have to place repeated orders, which will have a lower setup cost, since the machine's program is made already. The price for options like this is often negotiated.

Some assembly houses will save on setup cost by combining boards from different customers. This may be a reason for longer delivery times.