P08428: LED Lighting for Sustainable Venture
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Design for Manufacturing and Assembly

How to Estimate Manufacturing Costs

Intro to Design for Manufacture

Component Costs

The component costs include both mechanical and electrical parts such as connectors, and LEDs. The sheet metal stamping operation will be subcontracted to save money in tooling.

Manufacturing Bill of Materials

Assembly Costs

Assembly costs include machines, tools, and other physical supplies to complete the assembly of the retrofit kits.

Manufacturing Plan

Overhead Costs

Overhead costs include those required to successfully run a business but do not generate any profits. They include accounting, advertising, indirect labor, insurance, interest, legal fees, rent, repairs, supplies, taxes, telephone, and utilities.

Identified Cost Drivers

Cost drivers are activities that cause an indirect cost to occur.

Life Cycle Costs

Life cycle costs are the summary of costs incurred to install and sustain a product until retirement. For this project, life cycle costs include installation labor, retrofit materials, maintenance, total electricity, and the total material costs for all LED and board replacements. The life cycle in based on the fixture lifetime. These costs will be incurred by the customer.

Life Cycle Costs