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What Does Design for Cost (DFC) Mean?
Design for cost is an integral engineering practice that allows product development teams to integrate cost awareness into every engineering design phase. Its core importance is to maintain efficiency in design and manufacturability. It rationalizes manufacturing and life cycle costs while retaining the functionality and quality of a product.
DFC is different from reactive cost-cutting because it encourages proactive planning by prioritizing cost-specific strategies, including designing for scalable production volumes, setting cost targets to guide tolerance optimization, and choosing materials and processes that increase long-term affordability without compromising performance.
What Does Design to Cost (DTC) Mean?
Design to Cost (DTC) is a cost management principle aimed at rationalizing or minimizing the cost of a product to increase sales volume. This strategic methodology begins with a predefined cost target and ensures all product design decisions are within the predefined cost ceiling and meet performance and market expectations.
In the design stages, DTC accounts for the development, manufacturing, and service costs, implementing the necessary cost strategy during the project’s development cycle to ensure cost targets remain independent variables that influence decision-making.
Since engineering teams can determine over 70% of the final cost of a product in the design stage, the ultimate goal of the design-to-cost methodology is to achieve precise cost estimation. Design to cost is a typical practice in industries like automotive, aerospace, and consumer electronics, where strict ROI targets or pricing models determine product feasibility.
Unlike target costing, which encompasses administrative, marketing, and other approaches, DTC centers on cost management as a guiding factor during the design phase to ensure the design meets cost targets without requiring redesigns or adjustments.
Phases of Design to Cost
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The founder of AT-Machining has 30 years of CNC experience, dedicated to solving complex design and machining challenges for customers.
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Simplify part geometry by minimizing unnecessary contours or deep pockets, which reduces machining time, tool wear, and setup complexity without sacrificing functional performance.
Design engineers follow a strategic foundation to implement effective DTC before the production process. These include:
Specifying Target Costs
The initial step in implementing Design to Cost is to indicate the acceptable cost of the final product. You have to create multiple tiers or standards to achieve this outcome. The basic or standard tier would possess only the important quality and functionality, while a tier above it (mid-tier) would possess some innovation and additional features.
Meanwhile, the top tier would have even more luxury and functionality. For this reason, the latter can be regarded as design to value, a typical concept in cost and value engineering which focuses exclusively on optimizing cost efficiency while retaining high product value and performance.
You can employ any of these tiers as a starting point, depending on the type of project. It is an important part of DTC because it gives clear insight into the needs and scopes of the client and outlines the framework for the following stages.
Cost Management and Reduction Strategies
This phase is at the center of the Design to Cost methodology. It lays out different cost drivers to consider in the product design phase that will govern the final product’s price.
- Design Standardization: Design standardization across the product range is one of the core aspects of design development in any manufacturing industry. It should account for any material used while focusing on modular design across different products, as it helps to effectively minimize fixed costs. This practice is also one of the key focus points for Design for Manufacturing (DFM) and Design for Assembly (DFA).
- Use of Standard Parts: Another notable way to reduce production costs is to use readily available standard parts instead of customized parts. Collaborating with the suppliers of these products can also boost flexibility. Introducing standardization across the supply chain helps reduce the set-up and inventory costs greatly, encouraging simplified supply chain management.
- Geographical Factors: The location where products are manufactured is one of the critical aspects of cost management. Geographical factors, including supply chains and ecosystems, local supply chains, labor costs, taxes and duties, are important things to keep in mind. You can keep costs minimal when you choose the right manufacturing location.
- Packaging and Transportation: Volume and weight are key considerations that govern shipping and packaging costs. Hence, it is crucial to account for these factors and keep them to a minimum so as to rationalize a product’s total cost.
- Waste Reduction: Lean manufacturing principles are an essential concept that encourages waste minimization. It focuses on reducing waste in all stages of production. Any feature in the final product that doesn’t offer the customer real value is considered a waste and must be removed.
- Maintenance: Although maintenance is not an aspect of the production process, it should be considered as a priority. The right design decisions not only increase accessibility for difficult areas, it also elevate maintenance intervals. Focusing on maintenance-friendly product design can help reduce future costs after the production cycle since they won’t require frequent servicing, which will reduce long-term costs for the client.
Note that these factors are not to be considered in isolation because they are interconnected and have direct costs. You should always view Design to Cost (DTC) as a holistic approach that comprises a wide range of concepts. Thus, the design team should determine the crucial aspects when considering DTC depending on the type of project and requirements.
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Standardize material selection to commonly stocked alloys, avoiding exotic materials that require special tooling, longer lead times, and higher per-unit machining costs.
Analysis of Results
This stage is the final and most important stage in the DTC process because it will govern the manufacturing decisions. It is crucial to examine if the design at hand aligns with the objective or if it needs to be revised and improved. The design team repeats the DTC process till the design meets or exceeds expectations or cannot be improved further.
Common Setbacks in Implementing Design to Cost
Here are some of the prevalent challenges design engineers encounter during the transformation of design ideas into cost-efficient strategies in product development:
Engineering Culture
Engineering culture or mindset is one of the most prevalent hindrances when implementing design to cost in product development because most product engineers may lack the overview of the importance of cost drivers.
That is, they often prioritize functionality without knowledge of how their design ideas impact costs. As a result, engineers need resources to understand cost implications at the early design phase to address this issue. However, they should be able to consider costs at the design stage without the need for expert resources.
Job Responsibilities
The uncertainty that comes with the responsibility of managing product costs is another prevalent constraint in transforming designs into a cost-effective strategy. As a result, it is important to confer the freedom and responsibility on design engineers and equip them with the necessary tools to practice cost management through design solutions. Consequently, they can make ideal design choices that significantly control or rationalize costs.
Component-level Knowledge
Without the detailed knowledge of a product’s components, design-to-cost strategies would fail. To overcome this, the design engineering team must understand the basic details of each component that forms a product to implement all the cost management strategies successfully. This insight allows design engineers to make intelligent and cost-saving design decisions.
Standard Cost Drivers in Product Design
Early recognition of cost drivers can guide design decisions of product development teams to achieve the desired outcomes. Here are common manufacturing cost drivers:
- Complex Geometries: Features like intricate surfaces or deep undercuts often demand custom tooling, multi-axis CNC machining, and extended setup times.
- Tight Tolerances: Tolerance levels beyond ±0.005” typically require high-end CNC machines, specialized tooling, and extra inspection, which can significantly elevate production costs.
- Supply Chain Complexity: Employing limited-supply or non-standard components can result in cost volatility, supply chain delays, and extended lead times.
- Expensive Materials: Exotic materials such as PEEK, Inconel, or titanium are more difficult to machine, even though they cost more than standard aluminium and plastics. Thus, it increases the cost of materials and processing the components.
- Secondary Operations: Operations like heat treatments, powder coating, anodizing, or assembly steps maximize handling, labor, and inspection time, which further drives up costs.
Common Strategies for Effective Design for Cost (DFC) and Design to Cost (DTC)
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Max is a technical sales expert with 10 years of engineering experience who has solved hundreds of complex technical difficulties and challenges for customers.
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Design parts to be machined in fewer setups, aligning critical features on the same face to minimize repositioning and improve production efficiency.
Design engineers can implement targeted strategies to minimize costs during the design stages using Design to Cost (DTC) and Design for Cost (DFC) approaches. Here are applicable strategies for Design to design-to-cost process:
- Employ Modular Architecture: You can spread design and tooling costs efficiently by designing components reusable across product families.
- Set Clear Cost Targets Early in the Process: During the early stage of concept development, define a realistic per-unit cost target that will guide design decisions and feature prioritization.
- Simplify Non-Critical Features or Substitute Materials: Simplify non-essential features or replace exotic materials with cheaper alternatives without affecting performance.
For DFC, you can apply the following strategies:
- Simplify Part Geometries: Create a design that reduces the need for multi-axis machining or complex molds to save costs and time. Avoid deep pockets, undercuts, and non-critical features across processes like molding or casting, and design symmetrical components to boost production efficiency
- Integrate Multiple Functions into a Single Part: Merge features to minimize the number of components and assembly, maximizing cost efficiency. i.e., a single injection-molded bracket that doubles as a spacer can reduce potential tolerance-stack-up, part count, and assembly time since it supports and spaces components.
- Optimize Tolerances for Function instead of Perfection: Extremely tight tolerances (such as ±0.01 mm) increase inspection effort, scrap rate, and machining time since they demand specialized machines or tools. Instead, define tolerances that fit functional needs like ±0.1mm.
- Use Standard Material and Components: To achieve cost optimization without over-engineering, use materials that meet application requirements without exceeding them and avoid high-performance materials like titanium unless necessary.
Conclusion
Design for cost is a fundamental principle that helps create cost models through design decisions. While it offers cost savings benefits in the early stages of design, it provides cost estimations with relatively limited details. However, as DFC and its other branches of Design for Excellence become more prevalent, engineering experts rely on future research for further information to increase system performance and minimize costs.
Whenever you need the help of professionals to optimize your product development processes and save costs in your manufacturing projects, think AT Machining. We are a renowned manufacturer with years of experience handling different complex machining projects for different industries. Contact us today; let our expert team offer you the right solutions to help strike a balance between cost, product quality, performance, and manufacturability.
