costs include the engineering, drafting and technical time (engineering costs generally will run $3000 to $5000 per design), redesign and retrofit cost, as well as the loss of their time on games design, purchasing and material control, freight costs, the warranty repair and freight costs, and additional supervision and manufacturing assistance costs as well as lost material labor and burden.
If the quantity of supplies will be less than 5,0000, it usually will be more economical to buy a standard power supply from a reputable manufacturer. For instance, Adtech Power buys most of their components in 50,000 to 500,000 quantity lots which greatly reduces component costs. There are no engineering costs since engineering was amortized over many customers for several years. Warranty costs are covered by the supply manufacturer. Tools, jigs, fixtures, test equipment, etc. do not have to be bought. Personnel training is eliminated. And most important of all, you are getting a well proven reliable design instead of a design which represents really experimenting on your product!
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