PCB Assembly Cost Savings – Another Benefit of System-In-Package
One of the key benefits delivered by System-In-Package (SiP) technology is the savings realized in the Printed Circuit Board (PCB) Assembly process. This is a benefit that is commonly overlooked by designers on the front end. Typically, they only look at the cost of the individual components on the Bill of Material (BOM) and don’t consider the cost of assembly. With System-In-Package technology, the number of components that need be placed during the assembly process can be significantly reduced. This reduction decreases the component set up time and actual time spent on the Pick and Place machine. Simultaneously driving down the assembly cost and the total cost of the finished product.
As an example of this, we went to a local PCB assembly house and had them quote the assembly cost of two boards. One board had only the OSD3358-512M-BAS System-in-Package device on it. The other board had over 120 components that would be needed to build an equivalent system to the OSD3358. The parts we used for the discrete design are listed below:
The equivalent discrete design to the OSD3358 has 21 unique line items that need to be set up and 128 individual placements that must be made. Depending on the quantity of boards assembled, the cost savings from using a System-In-Package can be significant. This is seen in the quotes we received from our PCB assembly house outlined below.
| Quantity of Boards Assembled | 10 | 50 | 100 | 500 | 1000 |
|---|---|---|---|---|---|
| Discrete Total Assembly Cost | $232.92 | $798.53 | $1,364.27 | $5,338.09 | $9,850.89 |
| Discrete Assembly Cost Per Board | $23.29 | $15.97 | $13.64 | $10.68 | $9.85 |
| OSD3358 Total Assembly Cost | $26.61 | $107.39 | $163.50 | $561.11 | $865.80 |
| OSD3358 Assembly Cost per Board | $2.66 | $2.15 | $1.64 | $1.12 | $0.87 |
| Total Savings | $206.31 | $691.14 | $1,200.77 | $4,776.98 | $8,985.09 |
| Saving Per Board | $20.63 | $13.82 | $12.01 | $9.55 | $8.99 |
As you can see when assembling a low quantity of boards, 10, using a SiP instead of the discrete components saves $20.63 per board. Even at larger volumes, 1,000 boards, the per board assembly cost savings is $8.99. This translates into a total assembly cost savings of almost $9,000 by using the OSD3358 SiP instead of the discrete components.
Conclusion
When this article was written the 1K price for the OSD3358 was $25. The cost of the 128 discrete components was ~$21.00. If your cost analysis stopped here you would conclude the discrete solution is lower cost.
However, when you look at the total cost including assembly you get a different story. To finish out the example started above we compared the cost to purchase the components and build 1,000 of each design. The results are outlined in the table below.
| OSD3358 | 128 Discrete parts | Savings | |
|---|---|---|---|
| Component cost per board | $25.00 | $21.00 | |
| Total Component Cost | $25,000.00 | $21,000.00 | |
| Assembly Cost Per Board | $0.87 | $9.85 | |
| Total Assembly Cost | $865.80 | $9,850.89 | |
| Total Per Board Cost | $25.87 | $30.85 | $4.98 |
| Total Board Cost | $25,865.80 | $30,850.89 | $4,985.09 |
The System-in-Package solution saves almost $5.00 per board and almost $5,000 on the total build. This calculation doesn’t even include the savings from a lower cost PCB the System-In-Package solution allows, or the increased revenues from getting to market faster, or the savings from simplifying the supply chain and increasing reliability.
The moral of the story here is that when evaluating if a System-In-Package device is the right solution for you, make sure you look at the whole picture!