The offshore quote is almost always cheaper at the line item. That is not the number that matters. The number that matters is landed cost per good unit in your warehouse, on the date you needed it. Once you build that spreadsheet honestly, domestic and offshore trade places more often than most hardware teams expect.
Here is how to model it, with realistic ranges for a 500-piece PCBA build.
The four cost buckets
Every PCB or PCBA program has the same four buckets:
- Unit price — what the quote actually says.
- Freight and duty — ocean vs air, HTS classification, Section 301 tariffs.
- Lead time cost — cash tied up, revenue delay, expedite fees.
- Quality cost — first-article, rework, scrap, RMAs.
Offshore usually wins bucket 1. Domestic usually wins buckets 3 and 4. Bucket 2 depends on volume.
A worked example
Take a 4-layer PCBA, 80 SMT parts, 500 pieces, Class 2, no exotic components.
| Line item | Domestic | Offshore | |---|---|---| | Unit price | $85 | $52 | | Total unit | $42,500 | $26,000 | | NRE / tooling | $1,200 | $900 | | Freight | $250 (ground) | $1,800 (air) or $600 (ocean) | | Duty + Section 301 | $0 | $2,600–$3,900 | | Lead time | 3–4 weeks | 8–12 weeks | | Expedite risk | Low | High | | Rework budget (2%) | $850 | $520 + return freight | | Landed total | ~$44,800 | ~$32,600 (ocean) |
Offshore still wins on paper by roughly $12k, or about $24 per unit. That is the real question every program has to answer: is $24 per unit worth the 6-week lead time, the tariff exposure, and the harder rework loop?
For a consumer product at 50,000 units per year, yes. For a defense subsystem at 500 per year, almost never.
What tilts it toward domestic
- Lead time is on the critical path. Every week of PCBA lead time is a week of delayed revenue. Domestic 3-week vs offshore 10-week is 7 weeks of cash you get back sooner.
- Volumes under about 1,000 per year. Offshore setup overhead swamps the labor savings at low volume.
- High-mix, low-volume. Every changeover costs the same, and offshore charges for it too.
- ITAR, EAR, or defense end-use. Not optional.
- Prototype and NPI iterations. You will spin the design. Ship time kills iteration speed.
- Tariff-heavy HTS codes. Section 301 on Chinese-origin PCBAs currently runs 25% on many electronics classifications. That is not a rounding error.
What tilts it toward offshore
- Volume is well over 5,000 per year.
- Design is stable — no more spins expected.
- Complex mechanical + electronic integration where regional labor cost dominates.
- BOM is loaded with parts already sourced in Asia. Shipping components across the Pacific and back to the US is expensive twice.
- You have a program manager who can absorb a 10-week loop without breaking the schedule.
The hybrid path most customers actually take
The cleanest answer is often not one or the other:
- Prototype and first article: domestic. Fast, easy to fix, cheap to iterate.
- Production: offshore or domestic based on the mature-design number. Requote once the design freezes.
- Critical spares and service parts: domestic. Short-lead-time buffer against the offshore pipeline.
Splitting the program this way is normal and does not cost extra as long as the design package is portable.
What SmartFab actually does
We quote both paths on the same RFQ and hand you the spreadsheet. Domestic partners for prototype and low-volume, audited overseas partners for production. Same accountable point of contact through both. Send us your Gerbers and BOM and we will show you the real landed cost for your program.