The Complete Cost Roadmap Before Crowdfunding Project
Every year LKK receives a lot of inquiries from inventors about getting help with prototype making for the crowdfunding campaign. Here are three frequently asked questions: How Much Is Needed To Turn Idea Into A Physical Prototype Despite time and investment varied among different product categories in terms of product development, LKK categorizes 3 …
Continue reading “The Complete Cost Roadmap Before Crowdfunding Project”
Every year LKK receives a lot of inquiries from inventors about getting help with prototype making for the crowdfunding campaign. Here are three frequently asked questions:
How Much Is Needed To Turn Idea Into A Physical Prototype
Despite time and investment varied among different product categories in terms of product development, LKK categorizes 3 types of investments as below so as to help inventors better plan their budget:
The first investment comes from function engineering costs. Before developing product functions, you would need to finalize a product function definition and check the realization feasibility of each function as a whole. If you can’t even succeed in finalizing a specification or feature description document in the product planning stage, you would never be able to have a cost control view. Changing or adding features along the way of the product development will be harmful to cost control. If you are looking for serious function engineering costs, make sure you have a serious product requirement document first.
After confirming the function that you need to realize, if you are an engineer, you can probably save this function engineering costs with your own work. If you are not, you would need to hire professional engineers. The standard work for the engineer includes PCB layout design, component selection, circuit diagram design, software coding, testing, and debugging. The engineering cost will be counted by the hours that would need to complete the work. Different engineers, subject to their skills, have different hourly rates. However, majorly, it is function complexity and technology maturity that decides the function engineering cost. Meanwhile, if your product has many features to integrate, even if those features are common to see, the engineering work is large and thus the cost will be high. LKK always advises inventors to plan merely necessary features for a new product because excessive features lead to a waste of investment. In addition, if you are trying to apply new product technology to a new product, additional cost you will need to plan for technology validation.
To test the defined function, you will need to invest in the production of 1 to 2 pieces of PCBA. Cost includes PCB board cost, component cost, and manual soldering cost. Again, you can either source and DO IT YOURSELF or outsource Onestop. The PCBA production cost is very minor compared to the cost invested in the engineering process. After you realize the function, you will need to have a beautiful product enclosure to make the product attractive in its look.
The second investment comes from design costs. Based on the product function, product use environment, and probably an investigation into potential customers’ preferences and existing competitive products, the designer will further work on the product design and mechanical design. The standard work for designers includes defining product shape, product color, product material, product finishing method, product assembly method, product structure, component selection, etc. If you are a product designer, you can probably save this cost with your own work. If you are not, you would need to hire a professional product designer or work with a design house.
To verify the design, you will need to invest in the production of the product enclosure and some of the mechanical parts. Factory prototyping costs varied subject to the product size, finishing requirement, and production difficulty (precision requirement, processing steps, required machine, etc). You can learn about different prototyping methods here.
A lot of inventors, when coming to hire designers and engineers, face difficulty in managing the design and engineering process themselves, assessing the deliverable qualities, or ensuring coordination between product design and product engineering. Product development project management is indeed heavy and professional work. LKK always advises clients to focus on what they excel in. If you are not good at product development, find a OneStop house that can help you streamline the product development process and help you with the mitigation of risk in design and engineering. Learn more about LKK OneStop service here.
Can I get a unit cost reference?
As long as you have a well-defined function document, you shall be able to get a cost range as a reference. Just be careful about the factors that would affect your costs such as component real-time cost, order quantity, quality requirement, etc.
If you have a design drawing, BOM (bills of materials), and electronic files, then you can get an accurate unit cost as a reference.
Need to get a quotation? Send your project details here.
I have only a very limited budget before crowdfunding, how can I realize the product?
Do it yourself or find someone who has skills in engineering or design in your network or freelance platform. The pros are that you can do it cheaply compared with working with a company. The cons are that you need to assess the work quality by yourself. If you can’t control the work quality and eventually you find that the prototype factory can’t use these workpieces and turn them into a prototype, it’s a waste of money and time. So, make sure you are competent in product development and always make smart choices in selecting partners to work with.
Leverage your main budget in product design and get the maximum marketing effort. Having beautiful product rendering, beautiful sketches, and product rendering videos is a key to attracting backers for your campaign. At least with product design, the prototype factory could make the enclosure for you to take a look at and you can use that to create content for the campaign. Learn more about LKK design service here. Regarding function engineering, realize features as much as possible with your remaining budget. The showcase features that you have completed in the campaign so as to win more confidence in your capability to complete the product function development.
Tell your budget and check out professional advice on to what extent can the product project completed with this budget. Inquiry NOW