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70 SMT Magazine • February 2017 dedicated to regular production, freeing up our original line for new product development and prototyping," Wagner added. While sheer desperation may have been the motivating force that drove Mark Verbos to start building boards for his synthesizer mod- ules, the electronic music pioneer and founder of Verbos Electronics found himself in a simi- lar situation. After receiving funding for the de- velopment and production of a new product line, followed by a very successful launch at an industry trade show, his company was sitting on an abundance of orders that appeared im- possible to fill based on his sources of supply at the time. Fearing the cancellation of orders due to an inability to deliver, Verbos immediately started looking for other subcontracting servic- es. "But the story was always the same; either too expensive or too slow. That's when I knew I had to start thinking about getting the equip- ment to build the product in-house." Interestingly, other than working with EMS subcontractors, none of these three companies had any previous hands-on experience in SMT manufacturing. And, although the circumstanc- es that led each of them to acquire and imple- ment their own SMT assembly lines may be dif- ferent, they were all seeking better control over some phase of their manufacturing process. Be it product development, quality assurance, in- ventory management, lead time, or product cost, increased control is the common impe- tus for these companies, and many others like them, to bring production in-house. So how does a company determine the true cost of obtaining this level of control? How much does it cost to set up and maintain an SMT assembly line? What is the payback peri- od for such an investment? An examination of some of the benefits of in-house production will show how these three companies have gauged their results. Product Lead Times In the fall of 2013, Verbos placed an initial order with a subcontract assembler for 1,000 pieces of his company's synthesizer modules. "We started taking our first deliveries in January of 2014, but deliveries were very slow and spo- radic," Verbos explained. "Our boards are rather complex, some products having up to 400 com- ponents. Testing and final assembly still had to be completed in-house, and as we started to receive additional orders, we quickly knew we were going to have serious trouble meeting de- liveries." After struggling through the summer of 2014, Verbos purchased a turnkey assembly line from Manncorp at the end of August, took delivery and received training in October, and in six weeks had shipped all his remaining back- orders. Of course, Verbos' experience with slow de- liveries cannot be considered an indictment of all EMS subcontractors, but when weigh- ing costs and selecting a new supplier, there is always the question as to whether they can deliver. "Working with a good vendor, lead times were typically eight to 12 weeks," Campbell's Tate explained, "and that's with everything go- ing right! From time to time, deliveries could BRINGING SMT ASSEMBLY IN-HOUSE Figure 2: Verbos' random sampling synthesizer module is just one of his company's 12 exclusive designs which can have as many as 400 SMDs in a 2.5" x 4" area.