HOWTO get stuff made in China

On his blog, Bunnie Huang -- legendary hardware hacker turned entrepreneur -- has begun a four-part series explaining how to have electronics manufactured in south China. This post focuses on the BOM -- the Bill of Materials -- where "Every single assumption, down to the color of the soldermask, has to be spelled out unambiguously for a third party to faithfully reproduce a design."

Designers often think using abbreviated part numbers. A great example of this is the 7404. The venerable 7404 is a hex inverter, and has been in service for decades. Because of its ubiquity, the term “7404” can be used as a generic term for an inverter. However, when going to production, things like the package type, manufacturer and logic family must be specified. A complete part number might be 74VHCT04AMTC, which specifies an inverter made by Fairchild Semiconductor, from the “VHCT” series, in a TSSOP package, shipped in tubes. The extra characters are very important, because small variations can lead to big problems, such as quoting and ordering the wrong packaged device (and subsequently being stuck with a reel of unusable parts), or subtle reliability problems. In fact, I encountered a problem once due to a mistaken substitution of a “VHC” for the “VHCT” logic family part. This switched the input thresholds of the inverter from TTL to CMOS logic-compatible, and resulted in some units having an asymmetric response to input signals. Fortunately, I caught this problem before production ramped, avoiding a whole lot of potential rework or worse yet, returns.

Here’s another example of how missing a couple of characters can cost thousands of dollars. A fully specified part number for the LM3670 switching regulator might be LM3670MFX-3.3/NOPB. Significantly, if the /NOPB is omitted, the part number is still valid and orderable – but for a version that uses leaded solder. This could be disastrous for products exporting to a region, such as the EU, that requires RoHS compliance (meaning lead-free, among other things). A more subtle issue is the “X” in the part number. Part numbers with an “X” come with 3,000 pieces to a reel, and ones lacking an “X” come in 1,000 pieces to a reel. While many factories will question the /NOPB omission (since factories typically assemble RoHS documentation as they purchase parts), they will rarely flag the reel quantity as an issue. However, you care about the reel quantity because if you only wanted 1,000 pieces, including the X in the part number means you’ll be paying for 2,000 extra pieces you don’t need. Or, if you’re doing a much larger production run and you omit the X, you could be paying a premium for shipping three times the volume of reels for the same purchase quantity. Either way, the factory will quote the part exactly as specified, and you could be missing out on a cost savings if you’re not paying attention to the reel quantities.

The series comes out of Bunnie's prep for a China tour he's giving to some MIT Media Lab students later this month.

The Factory Floor, Part 1 of 4: The Quotation (or, How to Make a BOM)


    1. Any “How to Manufacture in China” tutorial is also, by it’s very nature, going to be a compelling argument for doing your manufacturing in the US. My former employer had some of his parts custom-made at a Chinese plant, and although it was cheap, it was a constant headache. Even after meticulously going over his blueprints and making sure all the right parts were being used, the molds were up-to-date, tolerances were exact, etc, something would go wrong halfway through a production run. A plant manager would substitute a part, a jig would slip & nobody would catch it, or something. He’d drop tens of thousands of dollars on parts, and huge percentages were unusable crap. Off to China again…breathe the lovely green air of the industrial section…cough black phlegm for weeks…
      Yes, he does most of his manufacturing locally, getting 90% of his parts & labor within 50 miles of his personal home in the US.

    2. Robots.


      “Manufacturing” is coming back to the west, and pretty rapidly in some industries.  It just isn’t going to be what you hope it is.  The return of manufacturing to the US is being driven by price.  China’s wages are going up, and so the cost savings, especially when you add the hassle of working with Chinese suppliers (shipping, language, oversight, etc), is shrinking.  At the same time as Chinese wages are going up, the cost of  robotics is going down while their capability is going up.  

      If you look at the semiconductor industry, you can see a microcosm of this.  The semiconductor industry moved out of the US in a very serious way in previous decades, and it is now rushing back in.   Semiconductors are on the leading edge of the return because the product takes a lot of technical skill, and because automation has dramatically reduced number of button pushers to the point where the cost of unskilled and low skill labor is getting to be a rounding error.  Add on top of this the industry getting much better at pollution waste control (they make a LOT less waste now), and most of the advantages of moving to China vanish.  Whatever increased cost there is is more than made up for by having a pile of engineers and designers being in the same building.

      The downside to all of this is that the return of manufacturing means jack shit to the American rust belt.  This isn’t going to bring back high paying union jobs.  It is going to mean great things for engineers and scientist, but your traditional high payed union job for life is dead.  At best, you are going to get a handful of semi-skilled jobs with 2 year tech degrees that double as operators and a first line of defense in spotting problems.

      Mass employment for uneducated folks in the manufacturing sector is dead and it isn’t ever going to come back.

      1. Exactly. There will be manufacturing in the US again. There just won’t be unskilled labor to go along with it.

        1. Even if there were, it isn’t clear that it would help much. Almost all labor categories have shared the steady and dramatic decline in things like real wages, benefits, and job stability vs. ‘productivity’. 

          Even if somebody opened a 100% authentic 1959 factory line, complete with lots of manual labor, they would be vanishingly unlikely to bother with the sorts of salary and stability that would make for a blue-collar middle class…

      2. Then you are going to have to endure high levels of unemployment throughout the foreseeable future. The idea that everyone in the US will magically become engineers or scientists is a fairly self-centered pipedream among the tech elite.

          1. Eventually they’ll just die. I think that was the plan from the outset. (heavy sarcasm here. I am the grandson of a now gone master engineer and mold maker who was well respected as one of the country’s few mold maker/plastic injection sole propieter companies for many years). Worst thing was watching him sell off the machines for pennies on the dollar when he closed shop. 

        1. If you read cheering into that or a prediction that everyone is going to become an engineer or scientist, you badly misread.  I was just acknowledging reality.

          We are headed towards utopia where human work has no economic value and everyone has plenty.  The transition though is ugly.  You have people that need to keep working, and you need to give them enough incentive to keep working despite the fact that work sucks.  You also need to make sure that those that are automated out of useful economic work are not miserable and willing to kill those that still have work.  You are going to have a transition where people slowly go from being economically useful to economically useless.  Managing that is very, very, very hard.

          I think the US is already going through the first stages of this and stumbling pretty badly because they have not yet realized that some people are just going to be unable to find useful work.  They have weighted the system to trying to encourage work and punish unemployment even when there is no work to be had  for some.  France and the like are the opposite side of the coin.  They realize that not everyone is going to work, but have not yet figured out how to pay for it and so are racking up debt at an alarming rate.  I think the Nordic model is probably the closest.  They, in general, offer a good reason to work if you can, make you comfortable if you can’t, and pay for it.

          1. Well, if Kurzweil is to be believed, the transition to the postscarcity economy will, starting now, be at most 30 years or so. Then we party.

        2. You forgot to add the part where all those engineers and scientist will automatically gain that 5 years of experience that every employer is looking for, even for the most mundane task.

          1. It’s all hype. Simple as that. We have already exported the entire supply chain to that part of the world, starting in the late 70s’. These jobs are anchored there. Whatever we can get back in the short to medium term are only marginal at best. But the media needed an upbeat story…

      3. Not to burst your optimistic view on “Manufacturing back to US”. While it serves as good view on patriotic manners, but in reality, the world is not only governed by Dollars and Yuan. Just because China wages goes up doesn’t mean all manufacturing plants will go back to US. There are low wages in South Asia Countries. 

        1. It actually isn’t all that optimistic. The point of manufacturing getting the preferential treatment is because it gives low skilled labor something to do, something which I explicitly isn’t going to come back.

          While there do exist places with lower wages than China, they generally have large problems. What made China so appealing was not just low wages, but infrastructure to handle manufacturing… stuff like roads that can handle trucks, constant power, solid communication networks, and corruption at tolerable levels.More importantly, the rise of Chinese wages is only part of the story. The real story is the devaluation of human work. The reason why semi-conductors are coming back to the US has nothing to do with Chinese wages. It has everything to do with automation. You just don’t need all that many button pushers to run a modern day semi-conductor plant these days. Chinese labor could be free, and you would still pick a plant in the US that has the engineers and designers on site that can be easily supervised. The value of unskilled labor is dropping. It is going to be zero one day.

  1. Also there is lead time and the length of the supply chain.  You are stuck with forecasts you made 9 months ago. Customers are returning 50% of your sales?  Tough!  You can’t retool and get new products before 2014!

  2. Ha, try getting some phones made in super-secret resins which I couldn’t even allow Customs Officers to see (new at the time iMac colors). Phones that had not been made in years. During the Chinese national holiday fortnight. Probably lost five years off my life trying to get that done. And the good parts of my hair.

  3. You have to not make those mistakes when getting stuff built in the USA as well. It’s just easier to talk to the people who may or may not notice the mistake. 

    1. There’s cultural issues to consider too. Also, although our educational system is going to crap, it’s still better than most of the workers in Chinese factories, who probably grew up on farms that hadn’t seen new technology since 1950. I’m hardly an American exceptionalist, but American-made is still much better than Chinese-made in nearly everything, quality-wise. And it will have less cadmium in it too.

        1. Productive, sure. I won’t dispute that, but the quality of what they usually produce is not up to western standards in most cases. “Made in China” is a mark of quality to nobody anywhere.

    2. Agreed. I skimmed it, and it sounded just like my experience working in a manufacturing in the States. The BOM has to be precise, right down to the packaging, or you’ll have problems. You get your fastest turn, and highest quality, working with someone close by. Communication matters.

  4. The other problem is that as the lead times for orders become longer, the amount of inventory needed to protect you stocking out becomes huge.  You may either be unable to fill orders, or you might end up dumping huge amounts of unsold inventory. Either way, you’ll have to pay to store 70% more inventory than if you had it made locally. 

    Oh, and intellectual property?  Pffft

  5. I can’t speak for electronics manufacture, but I can tell you that making automotive parts for American companies isn’t much different, aside from having a shared language.

  6. I work in Engineering and I also have worked in software development. My experience has been that with Engineering there are so many ways to screw up something. Every part has to specified exactly, every material. The physical engineering is the hardest to get right. The circuit design and circuit boards are pretty quick to turn around and reconfigure, but, man, get a cabinet ordered with the wrong kind of paint, or order a button board that ends up having faulty glue, or send the plastics molding company the wrong or incomplete specs and you can end up with a delay, a recall, or product that never makes it to the light of day.  

    From what I’ve seen with the work we do in Korea (for products that involve manufacturing capabilities we do not have in the US), we let them handle a lot of the engineering and purchase a more or less finished product, which we incorporate into our products. Or we start with a product they developed and then we tweak it for our market, but the Korean firm still does the actual design and engineering work. From what I’ve read, this is the strength of working with China, that they have engineers that will do the design work for you and the companies also have easy access to lots of parts. I doubt that many people working with China need to be as involved with the manufacturing process as this manual is spelling out.

    1. It’s not really a cultural stereotype when the problems are almost universally noted, including by Chinese people doing business in China.

  7. If the customs goons weren’t able to detect lead-containing toothpaste and melamine-enriched pet food, what’s the chance they will be able to spot a lead-containing chip between many identical-looking chips on an otherwise “compliant” board? 

    The issue with omitted /NOPB may be formation of intermetallics with some solder alloys (typically bismuth-containing ones form low-melting eutectics with lead that can lead (heh) to power transistors dropping off boards under load), but otherwise I’d consider it harmless, maybe even beneficial due to the lack of incidence of tin whiskers in tin-lead alloys. Those buggers can grow even through conformal coatings. If they’d only grow into the arses of the RoHS eurobastards…

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