You think you’re buying boards, but you’re paying for panels.

When we consider ways to drive costs down for printed circuit boards (PCBs), it seems the first choice is to browbeat fabricators into submitting lower bids. That’s neither healthy nor right. Your technology partners need to be financially healthy.

If, instead, we look at material costs as a potential area for savings, we can find fertile ground for cost savings that an OEM can control.

Many OEMs consider panelization a manufacturing task and blindly delegate those decisions to suppliers, both fabrication and assembly. In doing so, they are missing an opportunity to affect material expenses, a leading cost driver for PCBs. Additionally, OEMs usually have multiple suppliers they work with: some for fabrication, others for assembly, and different ones for prototype versus production. Each supplier has its own panelization constraints and preferences. Thus, the communication process between OEM and each of its suppliers is repeated and inefficient, and little is done to maximize material utilization consistently across all suppliers. Ultimately, though, the OEM is responsible for product costs.

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I am fortunate to have a business relationship with Toshiba that began in the early 1980s.