Beyond the Catalog: Total Cost of Ownership for Hermetic Solutions

Most people focus on the initial purchase price when they need a hermetic solution. However, the upfront price is only a small part of the full story, and it’s essential to address the total cost of ownership (TCO). TCO is the full cost of owning and operating a product over its entire lifecycle. It includes everything from purchase price to maintenance, testing, downtime, and even logistics. Let’s explore why TCO matters when evaluating hermetic solutions and why it’s crucial to look beyond the catalog price to ensure you get the best value.

Key takeaway

There are several hidden costs related to acquiring hermetic connectors and feedthroughs. Douglas Electrical Components helps reduce TCO by partnering with our customers to provide reliable, high-quality, easy-to-use hermetic solutions that can be expanded into larger assembly solutions with flexible delivery options.

The Hidden Costs That Drive Up Ownership

All products contain hidden costs that add up over time. Hermetic connectors and feedthroughs are no different. Some of these costs are more universal, but others are unique to hermetics.

• Ability to Meet Application Demands Over Time: Hermetic solutions often operate in harsh, challenging environments where reliability is crucial. If the solution fails to meet these demands and requires regular replacements, you will incur additional costs for each replacement. Replacement cycles, downtime, and re-training can add up to far more than the purchase price. A reliable hermetic assembly that lasts for decades without repair or maintenance eliminates those repeat costs.

  

• Quality Assurance and Testing: The quality of hermetic solutions cannot be ignored. Why? If a part fails in the field, the costs can be huge, sometimes reaching hundreds of thousands or even millions of dollars in lost time/productivity, resources, and significant downtime for key programs. In addition, a failure could seriously damage the organization’s reputation, resulting in lost opportunities in the future. Components that aren’t thoroughly tested before shipping leave buyers exposed to those risks.
• Assembly Efficiency: A hermetic solution is just one piece of a much larger application. Companies need to outsource and work with several vendors to assemble the end product. Integration challenges may affect the final build. Components that require adjustments, extra handling, or lengthy training waste hours on the production floor. Those labor hours add up quickly.
• Logistics: Managing parts through multiple vendors can lead to various complications, including freight costs, late delivery windows, and administrative overhead associated with coordinating between suppliers, managing purchase orders, quality inspections, payment terms, etc. Each of these factors creates hidden costs that are rarely factored into initial quotes. Finding a vendor who can offer a value-added, turnkey solution minimizes the overall cost and lead time. Working with a single vendor can often be helpful in the event of a quality matter.
• Warehousing: Inventory management becomes more complex with multiple part numbers and suppliers. You need larger safety stocks, more storage space, and additional tracking systems.  Having a vendor that offers flexibility in terms of annual contracts and just-in-time inventory can have significant economic impacts that are often overlooked when making decisions based solely on unit price.
• Labor: Training, wage hours spent installing, maintaining, repairing, and/or replacing hermetic solutions all increase the overall cost of a hermetic solution. People who attempt to develop an in-house solution must also consider the time required to create it. In addition, the variety of technologies and solution types results in different demands on end users. It’s generally more productive to let your personnel focus on executing your company’s core competencies, rather than trying to apply their efforts to areas where other companies specialize.
• Deployment and Installation: The installation of a new hermetic solution requires training for the installation teams. These parts have specifications, connection methods, and/or handling procedures, which, if not followed properly, may result in installation errors, delays, and rework. The learning curve for each new component type adds time and potential mistakes to your deployment process. An application-specific solution takes these elements into account, thereby reducing potential points of friction. Additionally, it’s possible to select quick-connect or turnkey solutions designed to simplify installation.
• Operational Expenses: Beyond installation, there are recurring costs: maintenance, repairs, training refreshers, and ongoing supervision. Some hermetic solutions may require regular inspections, calibrations, or component replacements or specialized tools and training. These operational expenses may continue throughout the product’s life. Durable hermetic parts with minimal maintenance requirements reduce these costs significantly.
• Lifespan Economics: Longevity is the most overlooked cost. A component that lasts decades without replacement or maintenance is inherently less expensive over time than one that requires periodic swaps. It eliminates all associated costs of installation, procurement, testing, and downtime for the replacement cycle.

The True Benefits of Working with a Supplier Who Understands TCO

To avoid hidden costs and ensure you’re investing in the right solution, you should partner with a supplier who is committed to optimizing TCO for you. Here’s how working with the right supplier can reduce your costs:

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  Inventory Optimization: An experienced supplier helps you implement just-in-time delivery programs and flexible inventory agreements. Just-in-time delivery means that you receive parts only as needed, which reduces warehousing and storage costs. You won’t be left with unnecessary stock or the need to store large quantities of parts. Blanket purchase orders and scheduled releases help smooth your cash flow while ensuring availability.

• Value-Added Solutions: Instead of piecing together individual components, a smart supplier who can offer bundled solutions, such as hybrid configurations or parts with pre-installed cable harnesses, can reduce your machining, tooling, and assembly costs. These value-added solutions will help simplify your processes and reduce labor and material costs.
• Sustainability and Efficiency Goals: The environmental impact of sourcing from multiple suppliers can be significant. Working with one supplier who can deliver a complete hermetic assembly reduces emissions associated with transportation and production. Additionally, working with a company that adheres to LEAN manufacturing principles and is certified to both ISO 9001:2015 and ISO 14001:2015 standards ensures that you support sustainability at every step.
• Comprehensive Quality Assurance: Suppliers who understand TCO invest in 100% testing and quality systems that prevent field failures. The cost of this comprehensive testing is minimal compared to the potential costs of failure in critical applications.  The cost of a part failure in the field can far exceed the premium you pay for a high-quality, tested part.
• Ease of Use: Turnkey and plug-and-play solutions are often easier and faster to deploy, saving both time and money on installation. Standardized parts simplify maintenance and reduce training costs, leading to fewer mistakes and faster implementation. This means your teams can focus on their core competencies instead of figuring out integration challenges.
• Decades of Expertise: A supplier with over 80 years of experience can help you identify the most cost-effective solutions upfront. Additionally, they can support you with ongoing cost-saving initiatives to keep your existing products running smoothly and efficiently. Some of them can suggest alternative approaches, materials, or configurations that reduce your total costs while maintaining or improving performance.
• Lead Time Flexibility: An experienced supplier who is nimble enough to expedite parts or adjust lead times to meet your deadlines ensures that you can keep critical programs on track, even when schedules are tight. This flexibility prevents costly delays and helps you meet customer commitments without premium freight charges or rushed production.

• Made in the USA: Partnering with a supplier who manufactures domestically can help reduce shipping costs and lead times, and minimize risks associated with international supply chains like tariffs. Local manufacturing also supports quality control, as the production processes are more easily monitored and aligned with your standards. Working with a supplier that proudly produces in the USA demonstrates your commitment to supporting domestic industries and creating jobs.

Where Douglas Electrical Fits In

Douglas Electrical Components addresses TCO concerns through comprehensive solutions designed for long-term value:

• Reliability by Design: We provide no-maintenance, long-life assemblies that continue working for decades. This helps reduce operational costs and eliminate unexpected failures. Don’t settle for sub-par solutions when the perfect one exists.

• Quality Assurance: Our experts perform 100% testing of every part, preventing costly failures in the field. This investment in quality supports your reputation for reliability and reduces maintenance costs.
• Turnkey Solutions:  We provide turnkey solutions that enhance machining and assembly efficiency offering options, such as hybrid configurations, port plates, cable harnesses, and connectorization. You get proven solutions instead of collections of parts that require integration.
• Simplified Logistics: Our one-stop sourcing helps eliminate the complexity of managing multiple suppliers. Single purchase orders, coordinated deliveries, and unified quality standards streamline your procurement process.
• Flexible Inventory Programs: We provide flexible inventory programs, including just-in-time delivery, blanket orders, and inventory agreements that reduce warehousing costs and free up working capital.
• Installation Efficiency: We offer hermetic solutions in plug-and-play designs that simplify deployment and reduce training requirements. Your teams can install with confidence, knowing the solutions are designed to work together.
• Compliance Support: Our ISO 9001 and ISO 14001 facilities, with LEAN operations, ensure the quality and environmental compliance your applications require. We are ITAR, DDTC, DFARS, Conflict Materials, REACH and ROHS compliant. In addition, we produce products that are UL and ATEX certified. If you need additional certification, we can assist you in ensuring your application is fully compliant. The documentation and traceability we offer will support your need to meet regulatory requirements.
• Schedule Flexibility: Lead-time flexibility and expediting capabilities help you meet tight deadlines without incurring premium costs or compromising quality.

Flexibility vs. Buying Straight from a Catalog

Buying from a catalog is convenient because it allows you to compare prices and easily find something that suits your needs. However, catalogs often offer standard hermetic solutions without considering the full scope of your needs. The upfront price from a catalog may seem like a good deal, but you could incur additional hidden costs over time. This is where working with a supplier like Douglas Electrical Components, which offers consultative services as well as flexibility, can make a difference. With over 80 years’ experience and a commitment to high-quality, long-lasting hermetic solutions, we ensure the reliability and flexibility you need. We provide complete, turnkey solutions designed to optimize your TCO. By partnering with Douglas, you gain more than just a part; you receive a comprehensive hermetic solution that reduces costs across your entire operation, from inventory management to deployment, and everything in between.