Total Cost of Ownership Estimator™ Results

Created By: Chin's Green Solution Co.

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Cost FactorU.S.ChinaCalculation Formula
CoGS (Cost of Goods Sold)   
FOB price $25,000.00 $15,000.00  
Packaging $75.00 $75.00 unit price x packaging cost %
Duty $0.00 $0.00 duty % x price
Fees: % of price $0.00 $106.50 fee % x price
Fees: flat $0.00 $0.35 fee
Routine surface freight, excluding local $0.00 $736.62 % 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 $75.00  
Total CoGS $25,075.00 $15,993.47  
Other Hard Costs   
Carrying cost for intransit offshored product if paid before shipment $0.00 $225.00 shipment time in years X interest rate X price
Carrying cost for inventory on-site $122.92 $193.93 unit price X ( avg. cycle inventory mos. + safety stock mos. + buffer stock mos.) / 12 X carrying cost %
Prototype cost $0.05 $0.15 prototype cost/annual units/product life
End-of-life inventory $134.03 $379.29 1/12 x unit price x (Delivery time + avg. inventory) x annual quantity/annual quantity/product life
Travel: start-up $0.01 $0.02 start-up cost / annual units / vendor life
Travel: audit/maintain $0.07 $0.22 annual # of trips X (per trip cost of travel time + expense) / annual units
Pick/place into local inventory $0.00 $0.00 (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 $125.00 $125.00 U.S. unit price x purchase cost %
Total Other Hard Costs $382.07 $923.60  
Cumulative Total $25,457.07 $16,917.06  
Risk   
Emergency air freight $0.00 $367.40 % air freighted x (unit weight + unit pkg. weight) x air freight rate
Rework/quality $250.00 $300.00 unit price X quality cost %
Product liability non-recovery risk $25.00 $30.00 unit price X liability risk cost %
IP risk $25.00 $75.00 unit price X IP risk cost %
Opportunity cost: lost orders, slow response, lost customers $25.00 $15.00 unit price x opportunity risk cost %
Economic stability of the supplier $25.00 $15.00 unit price x supplier economic instabiltiy risk
Political stability of the supplier $25.00 $75.00 unit price x supplier political instabiltiy risk
Total Risk $375.00 $877.40  
Cumulative Total $25,832.07 $17,794.46  
Strategic   
Impact on innovation of distance from mfg. $750.00 $150.00 unit price x innovation risk cost %
Impact on product differentiation / mass customization $25.00 $75.00 unit price x commoditization risk cost %
Total Strategic $775.00 $225.00  
Cumulative Total $26,607.07 $18,019.46  
Green   
Production  
Shipping  
Local Warehouse  
Travel  
Disposal of obsolete inventory  
Total Green $0.00 $0.00  
 
 
 
GRAND TOTAL $26,607.07 $18,019.46  
5 Year Forecast   
Annual impact of wage inflation and currency appreciation on $ price of product 0.90% 3.00% 0.3 x (wage inflation % + currency appreciation %)