# Wire Harness Price by Quantity and NRE Calculator

> Source: https://netray.co/tools/wire-harness-price-by-quantity-and-nre-calculator
> Publisher: Netray (netray.co), AI and integration engineering for ERP and manufacturing systems.
> Section: Free Tools

## Short answer

Convert material, labor hours, overhead, test cost, NRE and target gross margin into a unit price and a price-versus-quantity curve.

## Category

cost-finance

## Industry

Wire Harness & Cable Assembly

## Audience

- Estimator
- Controller
- Sales engineer

## Tool

**Kind:** calculator

**Currency:** $

**Inputs:**

#### Material cost per harness

**Key:** material

**Type:** number

**Default:** 28.5

**Min:** 0

**Step:** 0.25

**Unit:** $

**Help:** Wire, connectors, terminals, seals, sleeving and labels at buy price.

#### Material scrap and spoilage

**Key:** scrap

**Type:** slider

**Default:** 4

**Min:** 0

**Max:** 20

**Step:** 0.5

**Unit:** %

#### Direct labor hours per harness

**Key:** labor_hr

**Type:** number

**Default:** 0.45

**Min:** 0

**Step:** 0.01

**Unit:** hr

#### Direct labor rate (wages and benefits)

**Key:** rate

**Type:** number

**Default:** 28

**Min:** 0

**Step:** 0.5

**Unit:** $/hr

#### Overhead applied to direct labor

**Key:** oh_pct

**Type:** number

**Default:** 110

**Min:** 0

**Step:** 5

**Unit:** %

**Help:** Factory overhead absorbed on labor dollars.

#### Test and inspection cost per harness

**Key:** test

**Type:** number

**Default:** 2.4

**Min:** 0

**Step:** 0.1

**Unit:** $

#### NRE to recover (fixtures, programming, FAI)

**Key:** nre

**Type:** number

**Default:** 1850

**Min:** 0

**Step:** 50

**Unit:** $

#### Target gross margin on price

**Key:** margin

**Type:** slider

**Default:** 28

**Min:** 5

**Max:** 60

**Step:** 1

**Unit:** %

#### Lot quantity

**Key:** qty

**Type:** number

**Default:** 200

**Min:** 1

**Step:** 1

**Unit:** harnesses

**Outputs:**

#### Material with scrap

**Key:** mat_loaded

**Expr:** material * (1 + scrap / 100)

**Format:** currency

#### Labor with overhead

**Key:** labor_cost

**Expr:** labor_hr * rate * (1 + oh_pct / 100)

**Format:** currency

#### Manufacturing cost per harness

**Key:** cost_each

**Expr:** mat_loaded + labor_cost + test

**Format:** currency

#### NRE per harness if amortized in this lot

**Key:** nre_each

**Expr:** nre / qty

**Format:** currency

#### Fully loaded cost per harness

**Key:** full_cost

**Expr:** cost_each + nre_each

**Format:** currency

#### Unit price at target margin

**Key:** price

**Expr:** full_cost / (1 - margin / 100)

**Format:** currency

**Primary:** true

**Description:** Margin is a share of price: price = cost / (1 - margin).

#### Lot revenue

**Key:** lot_revenue

**Expr:** price * qty

**Format:** currency

#### Lot gross profit

**Key:** lot_gp

**Expr:** lot_revenue - full_cost * qty

**Format:** currency

**Primary:** true

**Chart:**

#### Unit price vs lot quantity (NRE amortized in lot)

**Type:** line

**X:** qty

**From:** 10

**To:** 1000

**Steps:** 40

**Series:**

- price
- full_cost

**Disclaimer:** Gross margin is calculated on price, not as a markup on cost. A 28 percent margin equals a markup of about 39 percent on cost. Overhead rates, scrap and labor hours are examples; use your own costing data.

## Content

**Intro:** Harness pricing usually fails in one of two ways: markup is confused with margin, or NRE is forgotten at low volume. This calculator builds up a unit price from cost elements and shows how it moves with lot size.

**Sections:**

#### How to use the calculator

**Body:** Enter material per harness from your connector, terminal and wire rollups, direct labor hours from your labor estimate, and your labor rate and overhead percent. Add test cost and the one-time NRE to recover, then set the gross margin you need. The result is a unit price, lot revenue and gross profit, and the chart shows how price falls as quantity grows because NRE spreads thinner.

**Bullets:**

- Pull material from the connector and wire worksheets on this site
- Pull labor hours from the labor-time calculator
- Set overhead from your actual overhead pool divided by direct labor dollars
- Compare prices at the quantity breaks you plan to quote

#### Formulas

**Body:** Material with scrap equals material times (1 plus scrap). Labor with overhead equals hours times rate times (1 plus overhead percent). Manufacturing cost equals material plus labor plus test. Fully loaded cost adds NRE divided by quantity. Price equals fully loaded cost divided by (1 minus margin fraction), which gives a margin on price. To express the same result as a markup on cost, markup equals margin divided by (1 minus margin).

#### Reading the chart

**Body:** Two lines are plotted, fully loaded cost and price. The gap between them is the margin dollars per unit. Near the left of the chart, NRE per unit dominates, which is why short runs need a separate NRE charge or a minimum lot. If price flattens at a level above what the customer will pay at high volume, look at the cost elements, not just the margin, since labor hours and material are where improvement happens.

#### Common mistakes

**Body:** Calling a 30 percent markup a 30 percent margin. Applying overhead to material instead of labor when your pool is labor driven. Leaving test and inspection in overhead on Class 3 work where it is large. Amortizing NRE over a quantity the customer never orders. Setting one margin for all volumes instead of reflecting setup and risk at low quantity.

**Cta:** If cost data for quoting sits in ERP but price decisions are made in spreadsheets, we can discuss linking the two so quotes use current rollups.

**Faq:**

#### What is the difference between margin and markup?

**Answer:** Margin is profit divided by price. Markup is profit divided by cost. A 25 percent margin requires a 33.3 percent markup. This calculator targets margin, so price equals cost divided by (1 minus margin).

#### How should I treat NRE?

**Answer:** Either charge it as a separate one-time line on the quote or amortize it across a committed quantity. Amortizing over a quantity the customer might not order puts the recovery at risk, so separate NRE is safer for uncertain programs.

#### What overhead rate should I use?

**Answer:** Divide factory overhead expenses by direct labor dollars for the same period. Rates vary widely by shop and automation. The 110 percent default is illustrative, not a benchmark.

#### Why show full cost in the chart?

**Answer:** It lets you see how much of the price decline with quantity is NRE amortization versus margin, which helps you set price breaks that still cover cost.

## Search terms

wire harness price calculator, cable assembly pricing, nre amortization calculator, harness unit price by quantity, gross margin price calculator, wire harness cost estimating, cable assembly quote margin, price break calculator manufacturing

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