Total Cost of Ownership Estimator™ Results

Created By: t.shirt

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Cost FactorU.S.South KoreaCalculation Formula
CoGS (Cost of Goods Sold)   
FOB price $30.00 $100.00  
Packaging $1.05 $5.00 unit price x packaging cost %
Duty $0.00 $25.00 duty % x price
Fees: % of price $0.00 $0.71 fee % x price
Fees: flat $0.00 $200.00 fee
Routine surface freight, excluding local $0.00 $4.02 % routinely planned for surface freight x (unit weight + packaging weight) X surface freight rate
Routine air freight, excluding local $0.00 $29.48 (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 $0.50  
Total CoGS $31.05 $364.71  
Other Hard Costs   
Carrying cost for intransit offshored product if paid before shipment $0.00 $5.00 shipment time in years X interest rate X price
Carrying cost for inventory on-site $0.18 $1.67 unit price X ( avg. cycle inventory mos. + safety stock mos. + buffer stock mos.) / 12 X carrying cost %
Prototype cost $0.00 $0.01 prototype cost/annual units/product life
End-of-life inventory $0.34 $3.33 1/12 x unit price x (Delivery time + avg. inventory) x annual quantity/annual quantity/product life
Travel: start-up $0.01 $0.01 start-up cost / annual units / vendor life
Travel: audit/maintain $0.08 $0.84 annual # of trips X (per trip cost of travel time + expense) / annual units
Pick/place into local inventory $8.45 $8.64 (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 $0.30 $4.50 U.S. unit price x purchase cost %
Total Other Hard Costs $9.36 $24.00  
Cumulative Total $40.41 $388.71  
Risk   
Emergency air freight $0.00 $1.97 % air freighted x (unit weight + unit pkg. weight) x air freight rate
Rework/quality $3.00 $10.00 unit price X quality cost %
Product liability non-recovery risk $0.90 $3.00 unit price X liability risk cost %
IP risk $3.60 $12.00 unit price X IP risk cost %
Opportunity cost: lost orders, slow response, lost customers $0.90 $5.00 unit price x opportunity risk cost %
Economic stability of the supplier $1.50 $30.00 unit price x supplier economic instabiltiy risk
Political stability of the supplier $3.00 $30.00 unit price x supplier political instabiltiy risk
Total Risk $12.90 $91.97  
Cumulative Total $53.31 $480.68  
Strategic   
Impact on innovation of distance from mfg. $3.00 $10.00 unit price x innovation risk cost %
Impact on product differentiation / mass customization $6.00 $40.00 unit price x commoditization risk cost %
Total Strategic $9.00 $50.00  
Cumulative Total $62.31 $530.68  
Green   
Production  
Shipping  
Local Warehouse  
Travel  
Disposal of obsolete inventory  
Total Green $0.00 $0.00  
 
 
 
GRAND TOTAL $62.31 $530.68  
5 Year Forecast   
Annual impact of wage inflation and currency appreciation on $ price of product 1.05% 2.40% 0.3 x (wage inflation % + currency appreciation %)