You make a prototype by cobbling stuff together and show off the user interaction points, not by making a finished product or by dealing with FCC/UL/CE/etc. This will likely cost a few thousand USD worth of parts/assembly/tools/etc if you are counting your time as free (but could be done for less if you already have a decent amount of electronics around).
Once your idea has been validated with potential customers, then you start designing. If you will have low sales numbers (ie: 10k or less/year) then look for having high value and high margins (few hundred dollar price and 50% gross margins). If you will have high sales numbers (100k+ or 1M+ per year) then you can get down below the $100 price point and lower your margins somewhat (but I suggest staying above 25% gross margin).
Expect that your BOM (bill of materials) for the electronics parts, when priced at your yearly volume pricing, will be 1/3 of the cost of your product. Then add your margin to get the sale price. If you're selling retail, account for 25-50% margin for the retailers in addition to your margin (so customer may pay 3x what it costs you to build the product for).
Regarding eInk screens, going to large sizes (ie: Kindle DX range) is going to cost you a lot for the screen. Assume Amazon make very little profit on Kindle devices and you're in the ball park for how much their BOM costs them. Your competition for electronic picture frames are under $100 sale price retail, so I suggest you focus on differentiation so that customers aren't comparing your product to the <$100 picture frames if you want to be successful.
Comments
You make a prototype by cobbling stuff together and show off the user interaction points, not by making a finished product or by dealing with FCC/UL/CE/etc. This will likely cost a few thousand USD worth of parts/assembly/tools/etc if you are counting your time as free (but could be done for less if you already have a decent amount of electronics around).
Once your idea has been validated with potential customers, then you start designing. If you will have low sales numbers (ie: 10k or less/year) then look for having high value and high margins (few hundred dollar price and 50% gross margins). If you will have high sales numbers (100k+ or 1M+ per year) then you can get down below the $100 price point and lower your margins somewhat (but I suggest staying above 25% gross margin).
Expect that your BOM (bill of materials) for the electronics parts, when priced at your yearly volume pricing, will be 1/3 of the cost of your product. Then add your margin to get the sale price. If you're selling retail, account for 25-50% margin for the retailers in addition to your margin (so customer may pay 3x what it costs you to build the product for).
Regarding eInk screens, going to large sizes (ie: Kindle DX range) is going to cost you a lot for the screen. Assume Amazon make very little profit on Kindle devices and you're in the ball park for how much their BOM costs them. Your competition for electronic picture frames are under $100 sale price retail, so I suggest you focus on differentiation so that customers aren't comparing your product to the <$100 picture frames if you want to be successful.