How does a small company start making LED streetlight drivers?

[Kjelt]

Thanks but that is incorrect....Phillips is the biggest provider of UK streetlight drivers..by a long way.
British Local Government literally make out specs which they have already matched to Phillips Xitanium drivers....so that Phillips drivers get  purchased.

If that is true (which is against the EU fair trade policy) it is only the specifications on lifetime, moist , lightning etc. they want.
Don't forget that company has been making streetlamps since before WW2 they have tons of experience with designing the electronics for harsh conditions.
I can understand customers would like that robustness but there is nothing against your company to build the same quality driver.

I cannot understand how Chinese products can compete in the EU...there are enormous tariffs imposed on Chinese products into the EU.

Well as I said earlier the western companies ask huge overheads for their company.
Example: I wanted a 75W led driver, I asked my dealer for the Philips Xitanium and went to tme.eu for the Meanwell version.
The dealer came back with a quote of € 67.- ex 21% VAT so €81.- a piece AND I needed to purchase 12 pieces (an entire box).

TME had a Meanwell Led driver from China for €38.- incl. VAT so half of the western driver 

Now you can whine what you want but if you design a proper driver the BOM will be around $20 tops so there is a lot of margin to be made against the big companies, less so against the eastern companies 

As you know, NXP makes far more than just microcontrollers.

Come'on the uC and the caps are the most expensive parts of the driver, the rest are jellybean parts you can source from anywhere with almost the same cost.
You're BOM might be $20 instead of $14 but that does not mean you can not sell the complete fixtures or sell the driver with less margin than the competitor.

[ocset]

Now you can whine what you want but if you design a proper driver the BOM will be around $20 tops so there is a lot of margin to be made against the big companies, less so against the eastern companies

Thanks, but sorry I just don’t agree that there is as much margin as you say. In  the UK,  we use billions of lighting products……but  as far as switch mode LED lighting driver design goes….there are literally  ONLY THREE SMALL  UK-owned companies that operate in the design of switch mode LED drivers…….as follows….
1…..Harvard Technology
2…..Forge Europa
3…..EPA Excil

…if the margin was as big as you say, then there would be many more companies than the above three small ones.

I was interviewed by the MD of a UK owned SMPS company...he told me they imported >90% of their SMPS from the Far East.....he told me that it simply was not worth  designing or making  most SMPS's in the UK. They have a "Receiver depot" near Reading...where the Far Eastern designed SMPS's get imported to...they then do some final checks on them before shipping them on to the UK customers.

Other contributors here  have said that the cost of runing big corporations  is (relatively speaking) bigger than the cost of running small companies. I am sorry but again this is completely not the case. Especially  not in basic technology areas such as lighting. Running small companies is far more costly than running a big corporation.......small companies have to do all the admin and regulatory stuff...but with a smaller bottom line.

Also, notice how you cannot find a list price for the Philips Xitanium range of led drivers....this is because the price is 'fluid'.....it is varied to keep out smaller competitors that might at whichever time be trying to  get in on some of the moolah.

[Gyro]

Is there any possibility of your company purchasing one of the above LED drivers and using them in your own luminaire / lamp head designs (is your company able to make decent luminaires? You seem to be making complete outdoor lights). That sounds like a way of improving your poor reliability record. Customers might be more willing to buy from you if you can state that you are using one of the market proven reliable drivers in them. Maybe you can come up with a USP in terms of ease of fitting, swapping, maintaining... or cosmetically [Edit: Or optical performance?]

Given the stark facts as you perceive them, what do you think you should do, both from a company and personal perspective? At the moment, you just seem to be bemoaning the situation and asking what to do. It might be easier for people to comment on and add value to some proposed courses of action.

[ogden]

In  the UK,  we use billions of lighting products……

I doubt that you have billion street lamps in UK. You can't drop in the same bag streetlamp driver (which is contract business "material") with poundland LED lamp. It's ridiculous.

[Beamin]

As others have said: Focus on value not price. Tell your customer this. If they want a cheap unreliable solution tell them you are not the right company. But if your customer also services the street lights push the costs of replacing them and possibility of law suits when they burn out and cause crime or traffic accidents. You sales department is key to doing this. Advertisements are a great way to sell on price but very hard to sell value. Look at all the Chinese ebay ads that are comically bad at selling value: "110% senior technician certified family safe ISO 9001/802.11g certified compliant 7,000kw device"

Some companies also sell non/low profit products so they can retain/capture customers from their competitor. Its much easier to put in one order then two. Also if the customer is shopping a competitor and sees that it's easier to just switch to them its very hard to win that customer back. So hands on in person sales will work best if that is geographically possible. Also emphasize that they call and get a native English speaker not an email in Chinese or some call center where the people don't give a fuck.

[dmills]

£80 list on a ~£15 BOM, sounds perfectly reasonable to me, you want at least 3:1 to actually make a profit, and nobody pays list in reality.

If you were taking them by the pallet load that £80, would be £60, and if you were taking them by the container load they would be cheaper again.

Of course 90% of an undifferentiated product like a SMPSU is from the far east, why would that be a surprise? I can buy a Meanwell IRM30 for well under a tenner and it comes with all the labels that make the man from UL put a tick in his box when preparing the CB report, or I can design some sort of random flyback thing myself that might cost me £5 in BOM, 20k in NRE and opportunity costs, and £70k to certify!

No UK company can sell me a UK made 30W, universal input potted flyback with all the marks required to make my life easy for that money (And with a two year warranty).

Volume really matters when the product is basically undifferentiated.

Regards, Dan.

[Jay_Diddy_B]

Hi,

You can get some insight into how well a company is doing by reading the financial reports. The reports for Harvard Technologies can be found here:

https://beta.companieshouse.gov.uk/company/02866874/filing-history

From the report, it looks like the company is pivoting away from LED drivers:



The reason, they are losing money if I am reading the results correctly:



Regards,
Jay_Diddy_B

[Gyro]

...ISO 9001...

A very important item. Having worked for a UK traffic control equipment company in the past, I can tell you that local authorities are very unlikely to buy from a company that isn't ISO9001 accredited.

Previous threads lead me to think that it is unlikely that your company has ISO9001 (I may be wrong). You need to put proper documented development and QA procedures in place and be audited against them.

[Kjelt]

Thanks, but sorry I just don’t agree that there is as much margin as you say.

Than that is your answer:
1 you can not produce an equally reliable, tested and certified product
2 you can not compete on price with asia/ big competition
3 there is no rocket science secret patent thingy to have or get an advantage over competitors
4 you have no foot in the door with large customers, nor the name / goodwill
5 you have no global service dept when something goes bad tech support can fix it in two workdays

What do you want us to say?
How about trying to make and sell smart phones? Also a Mission Impossible 10.

[ocset]

Of course 90% of an undifferentiated product like a SMPSU is from the far east, why would that be a surprise?

Thanks, yes, i agree.

Its actually the case that the Far East make a huge loss on SMPS's that they export to the  West. This is because the aim of their game is to totally knock out Western Electronics Design capability..... and in places like UK...this is working wonderfully well for them.......greedy  UK corporatists simply cannot resist the sound of some Far Eastern state  enslaving its people to work for peanuts and then buying product from them. Maybe one day  we can have slaves in UK too.....very nice for the  corporatists.....no desire in UK to operate in a decent manner like Germany sucessfully does....Germany of course, being the  world's largest exporter by capital value in 2014, and not enslaving a single one of its citizens to get there !!!

...The end game of this, of course, is disaster for the West....at least for countries like UK which simply fills its boots with Far Eastern stuff , not giving a damned about the future because the greedy corporatists will have left the UK long before its inevitable collapse.

[Ice-Tea]

Its actually the case that the Far East make a huge loss on SMPS's that they export to the  West.

No, it is not.

This is because the aim of their game is to totally knock out Western Electronics Design capability

No it is not. It is their aim to advance their country. Sure, they take a less than rigorous approach to currency managing and they couldn't care less about IP but in the end their goal is to make a better life for their people and to carve a place on the world stage for their country. Everything else is a sad sob story from people who couldn't adapt to changing times and seek a scapegoat
[/quote]

[ocset]

Absolutely, and they will be able to advance their country far more  with countries like the UK becoming dependent on them.

[Gyro]

To repeat... What are your proposed alternative courses of action. I'm sure people will be quite constructive in commenting and adding value. Just whining will get you nowhere.

P.S. Are you ISO9001? - that would be a constructive thing to do.

[mikeselectricstuff]

Also, notice how you cannot find a list price for the Philips Xitanium range of led drivers....this is because the price is 'fluid'.....it is varied to keep out smaller competitors that might at whichever time be trying to  get in on some of the moolah.

This is true of almost any volume business-to-business product. It's called "charging what the maket will bear"

 

[dmills]

As I say, if I was running a million units a year, and in a position to place contracts for 250,000 electrolytic caps a month a year in advance, then my cost base would probably not be that different to Meanwells, this should be obvious.

They can (probably) make some coin on those £10 switchers because I suspect that for them the BOM is about £3 or so, and I highly doubt that there is much manual slave labour involved in those things they are clearly designed for automated assembly, at which point what matter where they are put together, there are hardly any manufacturing jobs in running a pick and place line in any country. I highly doubt that there is an operating loss here.

Now I have zero interest in playing in a highly cost constrained basically undifferentiated market like that where go big or go home is very much the only way to play, and frankly I have zero interest in designing power supplies, the money is in the higher level systems design not in commodity subsytems like jellybean power supplies and LED drives.

Personally I think you guys are insane to be so tied up in trying to play in that space where your own costings say you cannot compete, there are plenty of niche opportunities out there where there is money to be made.

Regards, Dan.

[Ice-Tea]

Absolutely, and they will be able to advance their country far more  with countries like the UK becoming dependent on them.

Nobody is really dependent on China. They managed to build up a top notch electronics landscape in a generation or less, with no existing talent pool to draw from. If China ever were to abuse or leverage their position, there's nothing to keep us/you to rebuild our own industry in far less time (as the talent pool and much of the know-how is still there).

[Beamin]

Its actually the case that the Far East make a huge loss on SMPS's that they export to the  West.

No, it is not.

This is because the aim of their game is to totally knock out Western Electronics Design capability

No it is not. It is their aim to advance their country. Sure, they take a less than rigorous approach to currency managing and they couldn't care less about IP but in the end their goal is to make a better life for their people and to carve a place on the world stage for their country. Everything else is a sad sob story from people who couldn't adapt to changing times and seek a scapegoat

[/quote]

Look what japan did with TV's in the 1980 or 70's (there's a video on the forum) they sold TV's below cost to put US companies out of business then up the prices. That's what amazon is doing. Their profit were negative the first several years then they upped them right now it's 1% but as they shut down more and more retailers they will sky rocket the price leaving the consumer with no choice. Highly unethical and mostly illegal or it used to be. Look at home depot in the 90's cheaper and better then local hardware store in many ways (NOT a replacement but to some it is). All our local hardware store went out of business as soon as that happened home depots prices sky rocketed. They are charging up to $5.00 for things (an eye bolt for example) that cost less then $0.25 cents at the hardware store or home depot in the 90's; adjusting for inflation that should cost 28 cents. Don't like it? Go buy off amazon or Walmart. The cost of low prices is steep. When I was in high school we built a 200$k house almost exclusively with stuff from home depot. I couldn't imagine doing that now paying $5.00 for 500-1000 bolts. Instead of companies countries are doing it and there are no regulations to put them in check.

[ocset]

Thankyou Beamin.
Thankyou for having the integrity to call it like it is.
I hope things get better for you under the Great Donald Trump, i'm sure they will.
(i assume you are from USA as you speak of American  stores etc)

[james_s]

I doubt that you have billion street lamps in UK. You can't drop in the same bag streetlamp driver (which is contract business "material") with poundland LED lamp. It's ridiculous.

According to a less than scientific search I did, there are somewhere in the area of 5.6 million street lights in the UK. With a population of a bit over 60 million people I think this is a reasonable number. Surely there are not more street lights than people.

[ocset]

Thanks,  yes ok, i said there are billions of "Lighting products" (eg bulbs, lamps etc)  in UK..not "streetlamps".

[nctnico]

They are charging up to $5.00 for things (an eye bolt for example) that cost less then $0.25 cents at the hardware store or home depot in the 90's; adjusting for inflation that should cost 28 cents. Don't like it? Go buy off amazon or Walmart. The cost of low prices is steep. When I was in high school we built a 200$k house almost exclusively with stuff from home depot. I couldn't imagine doing that now paying $5.00 for 500-1000 bolts. Instead of companies countries are doing it and there are no regulations to put them in check.

They can charge that because people pay for it. But if you are smart and shop a bit further you can get much better prices. The Dutch equivalent of Amazon is great to find other webshops. If you buy direct from the webshop prices can be 75% less.

[Beamin]

Thankyou Beamin.
Thankyou for having the integrity to call it like it is.
I hope things get better for you under the Great Donald Trump, i'm sure they will.
(i assume you are from USA as you speak of American  stores etc)

It will take years to undo the damage. While rich people are getting HUGE tax breaks (the Koch brothers are getting 27 MILLION MORE per week) I have had my benefits cut. If it doesn't increase next year I am going to have to try and live with family. I'm just hoping they don't cut the program that is paying for me to get an education so I can go back to work.

The "corporations are not as profitable" as small businesses in a huge lie. They get volume rates on everything like their credit card machine, to postage, to tax breaks/ shelters, and loop holes. I had a retail business and someone was telling me the supplier I bought 80% of my inventory from was "not making enough profit" at their retail locations. They get the inventory directly from china for single digit % before mark up sale to customers. I paid 50 cents on the dollar for my inventory. I paid my employee 15.00 an our and they paid their employees 0.25 more then minimum wage. I actually worked there and their sales numbers were fantastic so what did they do? They cut their labor hours. The store manager gets so many hours per week he can work people. So they kept cutting hours as profit kept going up way over working the employees and making the store manager work 60 hours a week. I once punched in 5 minutes early and stayed late because the store was just overwhelmed with customers and you had to put away a constant 7 day a week delivery and there was no way the people could keep up. They said if I did it again I was fired. That's how cheap they are with the hours. They cut things until the profit falls as customers are walking out because lines are too long then they add a few hours to the schedule.They had sales targets: make or exceed them and they gave you a piece of paper saying good job and they were not easy, miss you numbers two weeks in a row and get fired. That's not commission. Get young enough employees and they are groomed to think this is how it works.

[tooki]

treez, I mean no disrespect, but given the questions you’ve posed over the months (years?), it seems to me that your company is suffering from a distinct shortage of experience and expertise, both on the business and technical sides.

I mean, it’s good that you guys are ambitious, but it seems to me you need to bring in some real subject matter experts if you really want to succeed. Asking questions on a web forum is no substitute for expertise and experience.

[Cerebus]

Asking questions on a web forum is no substitute for expertise and experience.

It can be a substitute for expertise and experience, just an exceedingly poor one. Then, when experienced forum members disagree with him over a rather whacky conspiracy theory about China he thanks the one person who does agree for their "integrity" in doing so, thereby implying that the many people I've watched trying to help him over the months lack integrity. Hardly a way to thank people for all the times they've helped him prop up his ailing designs.

[CopperCone]

This method usually works, at least for a while.... For those of us lucky enough to have seen it in action...