Design for Cost – Staying Competitive in Today’s World Market

Over 80% of the product cost is dictated by design. However, it has been surprising that most manufacturing industries continue to concentrate more on cost reduction measures that involve operations, just-in-time inventory, logistics and other activities. Companies that continue to invest in design of new products and technologies have to embrace the Design for Cost paradigm, it is more of a necessity than an additional attribute.

Cost Contributors in Design

Some of the significant cost contributors that can be attributed to design include:

  • Material Specification
  • Tolerance Specification
  • Number of Components in Assembly
  • Factor of Safety
  • Knowledge of Manufacturing Processes required to achieve desirable design characteristics
  • Packaging & Transportation

Let us look at each of the above.

Material Specification

When a design engineer selects a “suitable” material, he/she has to be driven by performance, life expectancy, reliability goals and, intrinsically, the manufacturing process to be adopted. A material selected with lower endurance limits would require larger cross-sections and heavier designs to achieve desired life. The higher the endurance limit, the lower the failure rates. However, with a higher endurance limit, the material costs also increase. A fine balance between life expectancy and cost has to be arrived at for least-cost-designs.

Selection of material is also dictated by ease of manufacture, manufacturing processes available within company or supplier base.

It is a good practice to have a material database in CAD design that reflects the current prices so that the Design engineer can select materials for least cost design.

Material Selection - Design for Cost Alternative
Material Selection – Design for Cost Alternative
Tolerance Specification

While industries have perfected the art of communicating the tolerances for a part, the processes adopted for specifying the tolerance values is still a work in progress. Equal emphasis has to be there for tolerance specification. This is driven by Cost of Precision Vs. Cost of Poor Quality Analysis. Taguchi’s Loss Function comes of use in defining the Cost of Poor Quality based on history of costs incurred on account of poor quality for a particular objective.

G D & T Drawing - Tolerance Specification

Tolerance Specification on Drawing decides the cost of the part. Every critical-to-quality tolerance specification on the drawing adds to the cost of the product. Hence, all specifications need to have a basis, driven by Quality, objectives as considered in Design Failure Modes and Effects Analysis. The RPN (Risk Priority Number) helps prioritize tolerances as critical, essential and desirable. This ensures that least-cost-designs are carefully arrived at for a win-win situation.

Number of Components in Assembly

Fewer number of components in assembly, lesser fitment issues and associated costs. It is common knowledge that fixtures are a part of the manufacturing and assembly process for any product. Part manufacturing fixtures, inspection fixtures, tooling fixture, assembly fixtures are common place in product engineering and manufacturing companies. Every one of them adds to the cost of the product. Imagine the cost savings that one would achieve, if one of the component in the assembly itself serves as the assembly fixture, that locates and orients other parts onto itself, creating the finished product!

Assembly Design for Cost


If a complex part replaces many parts going into an assembly, the over all product cost is reduced substantially. This is on account of fewer assembly issues and associated re-work. It is a misnomer that simple part designs lead to lower costs. It is simple assembly designs that result in lower overall cost of ownership.

Factor of Safety

FOS based designs have long been proven to be over-designed and costly. Life based designs are cost-effective and efficient. With changing customer priorities, it is all the more relevant that Design for Life takes the lead as a primary driver for cost-centric products. Giving design options for different life expectancy empowers sales to provide options to their customers in terms of price vis-a-vis warranty.

Knowledge of Manufacturing Processes

Process capability, processing sequence and stages have significant influence on product cost. If a design engineer provides for a location tolerance on a hole feature, that cannot be maintained, of what good is the tolerance specification?  Product cost becomes higher due to design. Rejections add to the costs as well. Herein comes the answer by following a process – Cost of Precision or Cost of Poor Quality? Which one is higher?

Re-work costs can be avoided by empowering the design process with the knowledge of the manufacturing processes, their strengths and limitations.

Packaging & Transportation

Numerous instances of a product blemished during transportation are known. Product replacement, re-work at site / customer are cost indicators that need to be avoided at design stage. Upfront engineering, involving packaging considerations, handling and transportation requirements, ensures evaluation of reduced cost alternatives before product release.

In all these cost considerations, the common denominator is design. Design for Cost is the need of the hour for industries to stay profitable and expand reaches to newer markets.

EGS India
E G S Computers India Private Limited, since 1993, has been in the forefront of delivering solutions to customers in the areas of Product Design and Development with SOLIDWORKS 3D CAD,Remaining Life Calculations, Validation using Finite Element Analysis, Customization of Engineering activities and Training in advanced engineering functions relating to design and development. EGS India - Authorized Reseller for SOLIDWORKS Solutions in India - Chennai, Coimbatore, Trichy, Madurai - Tamil Nadu, Pondicherry. For any queries on SOLIDWORKS Solutions contact @ 9445424704 | | Website -
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