The key factor is how fast units need to ship. In general, the scaling is sub-linear due to
1. reduced per-component costs (volume discounts)
2. less administrative/engineering overhead (ie the salaries/one-off costs get divided among more units)
3. more optimized assembly processes
Assembly labor expenses are directly proportional to how many units need to ship per timeframe. If an assembly worker can assemble 10 units a day, you're shipping 200 units/month. So you can ship 1000 units in 5 months or hire 5 people and ship 1000 units in 1 month.
Comments
Forgive my bluntness, I know next to nothing about manufacturing: are you able to scale up to 10k units at linear cost?
The key factor is how fast units need to ship. In general, the scaling is sub-linear due to
1. reduced per-component costs (volume discounts)
2. less administrative/engineering overhead (ie the salaries/one-off costs get divided among more units)
3. more optimized assembly processes
Assembly labor expenses are directly proportional to how many units need to ship per timeframe. If an assembly worker can assemble 10 units a day, you're shipping 200 units/month. So you can ship 1000 units in 5 months or hire 5 people and ship 1000 units in 1 month.
I would assume it actually becomes reducing cost, if anything?
Not sure, if you need to hire more people... again, I know nothing about manufacturing.