DFM for importers in China: Q&A with an expert

by Renaud Anjoran on 31 May 2011

One of the most common mistakes made by importers is to let a Chinese factory take care of a new product development (that’s true for most product categories, with a few exceptions such as apparel).

Fortunately, more and more Western engineers are present on the ground and familiar with local production techniques. They can help buyers with DFM (more on that below), processes improvement, and other engineering services.

I had the opportunity to ask a few questions to Paul Hornikx, a mechanical engineer with over 10 years of experience working with Chinese manufacturers. He is the Managing Partner of Venture Tech, an engineering firm based in Shenzhen, China.

Question: Can you define “DFM” in a few words?

DFM: Design For Manufacturing is the general engineering approach of designing products to make manufacturing easy, with details widely differing depending on the manufacturing method used, especially in China!

DFM should also target optimal product cost while maintaining the desired product quality and life (determined by the desired warranty, and keeping liberal return policies offered by large retailers in mind).

Cost, reliability and life are mostly determined during the early design stage and can cause a serious schedule reset if not done right, with added costly engineering time. Most Western companies do not like to re-commit their precious resources, draining them from a next generation product development.

Question: For which sourcing projects is DFM the most valuable?

DFM is really important for every first generation of a product, new for the manufacturer and new for the client: if no prior performance, processing or reliability in-house knowledge can be used to predict the behavior of the next generation.

It can be very surprising how certain small design, manufacturing or processing details can have a huge impact on product performance, in the short or long term. All these factors have to be considered in an initial risk and cost assessment.

Question: What are the risks for the buyer, if the factory’s engineers take care of product development?

The risks depend on the stage of involvement: the earlier the factory’s engineers get involved, the higher the risk of locking yourself into their optimal cost solution, not your best looking and performing product with optimal buyer costs.

If you ask 10 different molding companies for a solution you will get many different approaches which fit their operational environment the best, not yours.

Another risk is that factories aren’t staffed for full development cycles, stretching out development over a much longer period than anticipated. Clients often think that factories understand their end customers, resulting in a lot of miscommunication, where the clients basically end up educating the factory’s personnel.

Because of the high attrition rates the client might possibly have to educate the new staff all over again, perhaps next time with an engineer or sales person with much less English proficiency. I have seen this happening so many times.

Another cost risk is that if you approach a molding company they will obviously propose an injection molding solution, which given a particular volume might require a much higher upfront investment than with vacuum forming for instance.

Question: Can you give an example where the buyer’s engineers didn’t take into account the reality of Chinese manufacturing?

Unfortunately this is becoming more and more of a reality.

One of my clients had a product designed and engineered (before involving us) without considering manufacturing costs savings in China. The sad result was that the product couldn’t be sold at that cost. Coming from such a cost sensitive environment this is a very painful experience.

Where I come from the design and engineering discussions would revolve around a fixed maximum cost, the solutions would fit the look and cost requirements from the early beginnings.

Interestingly marketing often also wants the absolute lowest achievable cost target with the high quality suppliers available, so they can determine what features and finishes to include or exclude, such as Chrome plating etc., which in some cases can substantially increase the profit margin — positioning the product in a whole different category.

Question: Can you give an example where DFM helped a buyer reach a target price?

One of my clients gave me a cost target from day one, which is great actually. The DFM focused on materials and wall thickness (weight equals material cost) primarily while maintaining engineering integrity.

For instance: a large box-shaped product had 2mm thin walls and needed more torsion stiffness. With computer simulation and optimization we found that thickening the walls in certain areas had as much effect as thickening the walls everywhere, saving considerable weight and cost.

By using HIPS (High Impact Poly Styrene) instead of ABS we achieved another 30% cost reduction on the same part. The risk with HIPS however is that it flows less easily in a mold than ABS, generating weaker and more obvious knit lines in more sensitive areas. To overcome this HIPS material-associated weakness, we had to increase the wall thickness in these areas, while keeping tooling constraints and costs in consideration.

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