A supplier’s production cost looked eight per cent lower than a competitor’s until the aging step appeared. The cheaper quote had excluded burn-in from the station time and assumed a first-pass yield the process had never measured. Both figures were internally consistent, and only one described the product.
Charger production cost: six claims worth verifying
The purchase quantity behind the material prices, the station time and test plan, the yield figure, the overhead allocation, the completeness of the fixed charges, and the currency and payment terms.
Each claim has a documentary or measurable answer, which is what makes verification possible without asking for the supplier’s internal model. The purpose is not to audit the factory’s accounting; it is to establish that two production costs describe the same product and the same process.
The six are ordered by how often they change the comparison, and the yield figure changes it most in effect even though it appears third in the list.
Claim 1: the material price assumes a real purchase quantity
Material prices depend on what the factory actually buys.
Ask which quantity the material line assumes and whether it corresponds to the order or to a bulk purchase the factory holds. A price built on a quantity the buyer is not ordering is an assumption rather than a cost, and it is the most common reason two quotes for the same design differ by several per cent. Part numbers matter as much as quantities: a different approved part is a different product.
Claim 2: the station time reflects the test plan
Assembly, test and packing time follow quality decisions.
Ask which test positions are included, how long any aging step runs and whether the figure includes the packing operation. A production cost that excludes burn-in is not a lower cost; it is the cost of a different process. Where the plan genuinely requires a shorter aging period for a stable platform, that is a legitimate difference and it should be stated rather than inferred.
Claim 3: the yield figure is a measurement
Yield is the input a quotation rarely shows and always uses.
Ask for the first-pass rate on the last three production batches and how it was measured. A yield taken from an assumption makes every downstream number optimistic, and the effect is direct: a five per cent loss adds roughly five per cent to the cost per shipped unit. Where the factory cannot produce the figure, the safe assumption is the one from a comparable product.
Claim 4: the overhead allocation reflects the schedule
Overhead follows what else the line is running.
The allocation is a share of equipment, premises and supervision across the products in a period. A quotation produced in a quiet quarter can carry a lower allocation than one produced when the line is full, which is why the overhead line is worth revisiting at each order rather than treating as fixed. The buyer’s relevant question is whether the product has a slot, not what the overhead rate is.
Claim 5: the fixed charges are complete
Four groups, and the quotation usually shows one.
Mould and die, fixtures and gauges, trial loops, and packaging plates. A production cost that includes only the mould is complete for a platform build and incomplete for a new enclosure. Verify by listing the four and asking which are included, which are quoted separately and which do not apply to the configuration.
Claim 6: the currency and payment terms are stated
Two production costs in different currencies are not comparable without the rate and the terms.
Ask which currency the cost is expressed in, whether the rate is fixed for the order, and what the payment schedule is. A supplier quoting in a currency that moves, with payment required earlier, can present a lower cost that is higher in practice once the cost of capital and the exchange exposure are counted.
| Claim | How to verify it | Common gap | Effect on the comparison |
|---|---|---|---|
| Purchase quantity | Ask which quantity and part numbers | A bulk price not applied | Several per cent |
| Station time | Ask which test positions and aging | Burn-in excluded | A different process |
| Yield | Ask for the last three batches | An assumed figure | A direct effect on shipped cost |
| Overhead | Ask what else the line runs | A quiet-quarter allocation | Order-by-order variation |
| Fixed charges | List the four groups | Fixtures and trials omitted | A second invoice |
| Currency and terms | Ask for the rate and the schedule | Unstated exposure | Cost of capital and FX |
How to verify each claim without an audit
Three documents answer most of the list.
The approved component list with the purchase quantities, the test plan with its limits and aging conditions, and the last three production records with their first-pass yield. With those three, five of the six claims are answered, and the sixth is answered by the payment schedule attached to the quotation. None of the three requires access to the supplier’s cost model.
When a claim cannot be verified
Three options, and none of them is to assume the best case.
Verify it by a different route, such as a pilot order that produces the data; price the risk into the comparison using a conservative figure; or choose a supplier whose claims are documented. The option that costs the most is treating an unverified claim as a fact, because it is embedded in the decision and only surfaces when the invoice or the schedule disagrees with it.
FAQ
Should we ask a supplier for its cost model?
The cost lines of a quotation describe what you are buying and can be requested; the internal model is the supplier’s own. The three documents above answer the same questions without asking for it. The cost lines of a quotation describe what you are buying and can be requested, while the internal model is the supplier’s own and answers a different question.
Why does yield matter so much?
Because it multiplies every other line. A five per cent loss on a process adds roughly five per cent to the cost of each shipped unit, and it usually indicates a fixture, an incoming check or a thermal issue that also affects the defect rate at the customer. A five per cent loss adds roughly five per cent to the cost of each shipped unit and usually indicates a fixture or thermal issue as well.
Is a lower overhead allocation a sign of efficiency?
Not necessarily. It can reflect a quieter period rather than a more efficient factory, which is why the allocation is worth revisiting at each order and comparing against the capacity answer. It can reflect a quieter period rather than a more efficient factory, which is why the allocation is worth revisiting at each order against the capacity answer for that period.
What if the supplier quotes in a different currency?
Ask for the rate and whether it is fixed for the order, then carry the exposure in the comparison. A price in a moving currency with early payment can be more expensive than a slightly higher price with a later payment schedule. Ask for the rate and whether it is fixed for the order, then carry the exposure in the comparison rather than in the contract.
Next step
Send the configuration, the markets and the expected quantity to Wecent Group through the contact page. The reply provides the cost lines with the purchase quantity, the test plan and aging included, the measured yield and the complete fixed-charge position. Related reading: OEM and ODM charger manufacturing, wholesale charger programmes and the factory floor. External references: ICC Incoterms rules, International Trade Centre Trade Map, IEC standards, BSI ISO 9001 quality management, UL standards and certification and TUV testing services.
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