Total Cost of Ownership Estimator™ Results

Created By: PREC TCO Form

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Cost FactorU.S.UKCalculation Formula
CoGS (Cost of Goods Sold)   
FOB price $1,272.10 $70.00  
Packaging $50.88 $5.60 unit price x packaging cost %
Duty $0.00 $5.60 duty % x price
Fees: % of price $0.00 $0.50 fee % x price
Fees: flat $0.00 $0.33 fee
Routine surface freight, excluding local $0.00 $0.32 % routinely planned for surface freight x (unit weight + packaging weight) X surface freight rate
Routine air freight, excluding local $0.00 $0.00 (1- % routinely planned for surface freight) x (unit weight + packaging weight) X air freight rate
Freight insurance at 0.5% on imported product $0.00 $0.35  
Total CoGS $1,322.98 $82.70  
Other Hard Costs   
Carrying cost for intransit offshored product if paid before shipment $0.00 $0.47 shipment time in years X interest rate X price
Carrying cost for inventory on-site $12.37 $1.90 unit price X ( avg. cycle inventory mos. + safety stock mos. + buffer stock mos.) / 12 X carrying cost %
Prototype cost $0.01 $0.03 prototype cost/annual units/product life
End-of-life inventory $7.77 $1.25 1/12 x unit price x (Delivery time + avg. inventory) x annual quantity/annual quantity/product life
Travel: start-up $0.02 $0.21 start-up cost / annual units / vendor life
Travel: audit/maintain $0.11 $1.07 annual # of trips X (per trip cost of travel time + expense) / annual units
Pick/place into local inventory $0.00 $25.44 (1- % of inventory delivered JIT) x U.S. unit price x pick and place cost as % of U.S. unit price
Purchasing cost, excluding travel $25.44 $44.52 U.S. unit price x purchase cost %
Total Other Hard Costs $45.73 $74.89  
Cumulative Total $1,368.71 $157.59  
Risk   
Emergency air freight $0.00 $0.26 % air freighted x (unit weight + unit pkg. weight) x air freight rate
Rework/quality $12.72 $2.10 unit price X quality cost %
Product liability non-recovery risk $2.54 $0.84 unit price X liability risk cost %
IP risk $2.54 $2.80 unit price X IP risk cost %
Opportunity cost: lost orders, slow response, lost customers $6.36 $1.05 unit price x opportunity risk cost %
Economic stability of the supplier $1.27 $0.35 unit price x supplier economic instabiltiy risk
Political stability of the supplier $1.27 $0.35 unit price x supplier political instabiltiy risk
Total Risk $26.71 $7.75  
Cumulative Total $1,395.42 $165.34  
Strategic   
Impact on innovation of distance from mfg. $0.00 $0.35 unit price x innovation risk cost %
Impact on product differentiation / mass customization $0.00 $0.35 unit price x commoditization risk cost %
Total Strategic $0.00 $0.70  
Cumulative Total $1,395.42 $166.04  
Green   
Production  
Shipping  
Local Warehouse  
Travel  
Disposal of obsolete inventory  
Total Green $0.00 $0.00  
 
 
 
GRAND TOTAL $1,395.42 $166.04  
5 Year Forecast   
Annual impact of wage inflation and currency appreciation on $ price of product 0.60% 4.50% 0.3 x (wage inflation % + currency appreciation %)