Total Cost of Ownership Estimator™ Results

Created By: Re-Shoring Manufacturing of Microfiber Bed Sheets

Modify Inputs

Cost FactorU.S.ChinaCalculation Formula
CoGS (Cost of Goods Sold)   
FOB price $8.00 $0.76  
Packaging $2.00 $0.38 unit price x packaging cost %
Duty $0.00 $0.03 duty % x price
Fees: % of price $0.00 $0.01 fee % x price
Fees: flat $0.00 $2.00 fee
Routine surface freight, excluding local $0.00 $944.21 % 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 $0.00  
Total CoGS $10.00 $947.39  
Other Hard Costs   
Carrying cost for intransit offshored product if paid before shipment $0.00 $0.01 shipment time in years X interest rate X price
Carrying cost for inventory on-site $0.16 $0.03 unit price X ( avg. cycle inventory mos. + safety stock mos. + buffer stock mos.) / 12 X carrying cost %
Prototype cost $0.00 $0.00 prototype cost/annual units/product life
End-of-life inventory $0.05 $0.01 1/12 x unit price x (Delivery time + avg. inventory) x annual quantity/annual quantity/product life
Travel: start-up $0.67 $0.67 start-up cost / annual units / vendor life
Travel: audit/maintain $10.00 $14.80 annual # of trips X (per trip cost of travel time + expense) / annual units
Pick/place into local inventory $0.12 $0.40 (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 $0.24 $0.40 U.S. unit price x purchase cost %
Total Other Hard Costs $11.24 $16.32  
Cumulative Total $21.24 $963.70  
Risk   
Emergency air freight $0.00 $1,177.35 % air freighted x (unit weight + unit pkg. weight) x air freight rate
Rework/quality $0.80 $0.08 unit price X quality cost %
Product liability non-recovery risk $0.80 $0.00 unit price X liability risk cost %
IP risk $0.08 $0.01 unit price X IP risk cost %
Opportunity cost: lost orders, slow response, lost customers $0.40 $0.08 unit price x opportunity risk cost %
Economic stability of the supplier $0.40 $0.08 unit price x supplier economic instabiltiy risk
Political stability of the supplier $0.08 $0.02 unit price x supplier political instabiltiy risk
Total Risk $2.56 $1,177.60  
Cumulative Total $23.80 $2,141.30  
Strategic   
Impact on innovation of distance from mfg. $0.08 $0.01 unit price x innovation risk cost %
Impact on product differentiation / mass customization $0.40 $0.11 unit price x commoditization risk cost %
Total Strategic $0.48 $0.12  
Cumulative Total $24.28 $2,141.43  
Green   
Production  
Shipping  
Local Warehouse  
Travel  
Disposal of obsolete inventory  
Total Green $0.00 $0.00  
 
 
 
GRAND TOTAL $24.28 $2,141.43  
5 Year Forecast   
Annual impact of wage inflation and currency appreciation on $ price of product 0.90% 3.45% 0.3 x (wage inflation % + currency appreciation %)