To Outsource or Not to Outsource PCB Rework


Reading time ( words)

When a task is outside a company's core competency, it's time to outsource in order to save time and money while reducing the risk. This core competency is a deep proficiency that enables a company to deliver unique value to customers. According to business texts, such a core competency creates sustainable competitive advantage for a company and helps it branch into a wide variety of related markets.

Typically, the litmus test for a core competency is that it's hard for competitors to copy or procure. Wait… isn't this the value proposition of EMS companies when selling the advantages of outsourcing to the OEM? Isn't the OEM better off designing, testing and supporting their customer base rather than being process geeks and "making" their widgets? Well, there is a case to be made that outsourcing certain rework projects makes a lot of sense.

Costs to Consider for a Rework Technician

Several factors need to be considered as part of PCB rework and repair costs when looking at the "total costs." These costs include the labor rate of the rework technician performing the rework and repair operations, their training program costs as well as costs associated with supervising the individual.

Hourly labor costs for soldering technicians performing rework operations drives a significant portion of the marginal cost of rework. The mean salary for associates skilled in the art of rework is $14.23 in the United States. The national average for the overhead burden which needs to be added this hourly rate is 42% for manufacturers with less than 500 employees. This consists of both voluntary (medical, dental and life insurance, etc.) and involuntary (i.e., social security, unemployment insurance, etc.). This puts the loaded cost at $20-$21 per hour.

Read The Full Article Here

Editor's Note: This article originally appeared in the April 2016 issue of SMT Magazine.

Share

Print


Suggested Items

Discover the Benefits of a Technology Center

10/23/2019 | Barry Matties, I-Connect007
Nico Fahrner, application engineer at Rehm Thermal Systems, talks with Barry Matties about the benefits prospective customers get from being able to fully test their systems in-line at Rehm’s technology centers before purchasing.

Catching up With Niche Electronics

10/09/2019 | Dan Beaulieu, D.B. Management Group
Niche Electronics President Frank Bowman speaks with Dan Beaulieu about his company, their services, how they help their customers, and their plans for the future.

SMTAI 2019: Happy Holden’s On-the-Scene Report

10/03/2019 | Happy Holden, I-Connect007
Last week concluded the 2019 SMTAI conference in Rosemont, Illinois. Overall, I think the show was successful and covered all aspects of SMT processes.



Copyright © 2019 I-Connect007. All rights reserved.