What is set up charge?
Set up charge is applied in the customized products for small value orders. It is similar to MOV, minimum order value. It is common that the products prices are higher for smaller quantities. But for customized products, the total cost is not able to be covered by the slightly increased unit price. So some factories takes set up charge to compensate the production cost.
PCB is a customized product. The PCB factories manufacture PCB boards according to the design and requirements from customers. Each type or model of PCB has unique dimension, thickness, outline, components placement, and so on. It is quite different from the finished products that can be sold and picked up from shelves of super markets. There are standard features of such finished products, which is general for different users. On the contrary, the PCB has specific features fitting to a single project. It is not able to manufacture the PCB boards in large quantity, and then sell the PCB products to different customers. Each PCB is new product and each order is nearly new order for PCB factories. So it is common that the PCB factories manufacture the PCBs according to the order quantities.
In some cases, the customer requires the PCBs in small quantity, like prototypes, samples, or small quantity for design verification. There is a minimum cost to produce a customized product. The production machines have to be adjusted each time for each PCB. This machine adjustment costs time and labor. And there are dozens of machines or processes involved in PCB production, from material cutting, drilling, etching, film laminating, circuit developing, solder mask developing, soldering printing, silk screen printing, to electrical testing. So the set up charge is required to make up the total cost of production.
Some PCB factories donot have such set up charge, but they have dozen times or even hundreds times unit prices for small quantity, compared to the normal production quantities. In this case, the total price would be equal to or even higher than set up charge.
Moreover, the set up charge is more related to the order value of each PCB, but not only depended on order quantity. Some PCBs have very small unit price, say, less than 0.1USD. The total order value would be less than 100USD even for 1000pcs. Usually 1000pcs is a large quantity. As it is mentioned above, the set up charge is similar to MOV to compensate the total cost, so the set up charge is more depended on order value.
SDY quotes small value PCBs with set up charge, in order to show the correct unit prices. It is ok to share this set up charge to average unit price as well, if you prefer it better. SDY accepts prototypes, samples, and small quantity orders. You can arrange your PCB orders to SDY from prototypes to mass production. Warmly welcome to contact us or contact Alex@sdy-pcb.com for any PCB questions or RFQs.