OT - Volume Discounts

DIg out a catalog like DigiKey, Mouser, etc and see what the "common' or "normally used" breakpoints are, like (perhaps) 1-9, 10-49, 50-99,

100-249 etc for items normally sold in small lots, or 1-999, 1000-4999, 5K up for items that are normally sold in quantity. Even DigiKey or Mouser will quote lower prices in the 10K up (in some cases 50K u) region. Price breaks get smaller as one "steps" into the next region. Make sure that you always have a profit (shipping and handling should always be seperate) on the products even if 10E20 are ordered. Selling at a loss (at any quantity) is a *loss* and CANNOT be made up for in quantity.

here's a bad example:

Bye. Jasen

Exactly! Digikey has hundreds of thousands of parts. They can't possibly be calculating these by hand. There must be an automated approach, and I want to study the details of that procedure!!

I hear you on volume. We would never sell on too thin a margin. Thanks for the input.

example:

I wonder if you get money back if you order 50?

-mpm

Well it's not a very good algorithm, because their breakpoints do not match their own suppliers' packing multiples. So you end up buying 100 pieces of a part supplied in tubes of 98, just to get the price break.

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John Devereux

Components have price breaks that can hit 5:1. Assembled electronics never does anything like that. We discount out products roughly 5% at qty 10 and might hit 15 or 20% for a high-volume longterm OEM deal where there's competition and margin.

John

Price breaks frequently make little sense, particularly for catalogue suppliers.

No one can tell me it makes sense when you want 20 of something and it is cheaper to buy 25 and throw 5 away (It might make a small amount of sense where breaks are related to pack sizes which they generally are not).

I haven't looked recently but I remember Farnell had very significant price breaks on Nat Semi parts, like if you wanted 12 you could buy 25 for the same price. I still have a lot of half empty tubes of National parts on the shelf from this. It was especially National parts so it must have been something to do with their relationship with National.

Farnell also did (still do?) some mixed price breaks where if you bought

100 different 74HC logic chips you got the 100 up price on all of them, or you could buy 100 different value resistors coming in 100 separate bags for the same price as 100 of the same value resistor supplied in one bag - crazy.

The breaks are a crude attempt at covering processing and handling costs. I would rather suppliers made fixed order and per item processing charges and only had price 'breaks' related to pack sizes.

In that case, i will buy 31 bars and throw away 30 of them!

example:

Now that is a thought! Perhaps one should order 100,000 bars and have them deposit a few million dollars into your bank account?

You don't throw them away - you use them to stock your junque box. ;-)

I had a project not too long ago where I needed to build 6 copies of a certain prototype. It turns out that a bag of 100 transistors is almost as cheap as 18 individual ones. I also ordered resistors in bags of 200, (which I still have most of in my parts cabinet) and so on.

Cheers! Rich

According to their chart, if you order 30 or more pieces, they're free!

Cheers! Rich