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How to Start a PCB Manufacturing Business?

How to Start a PCB Manufacturing Business?

Printed Circuit Boards are the carrier of current Industrial Revolution, the staple for every electronic product that is manufactured today and all the advanced products which either are still at nuanced stages such as AI, IoT, etc. or design stage have PCB as their integral part. 

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Growth Projection of PCB Business in India

As per Expert Market Research study, the Indian printed circuit board (PCB) market reached a value of USD 2.75 billion in 2020. The market is further expected to grow at a CAGR of about 18% in the forecast period of 2022-2027 to reach a value of approximately USD 7.45 billion by 2026

Anyone who wants to capture this market potential and grab the opportunity that lies ahead of being a PCB entrepreneur should understand the basics of how PCB manufacturing business works and what are the requirements to start one.

Begin with Blue-Sky Research:

The business research as the first step is of utmost importance to test the waters before you jump into it. Whether an electronic business or any other, a thorough business research never fails in providing in depth insights.

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Areas to be considered during business research are:

Demand- Any business is a success if it bridges the gap between what is needed and how easily it can be made available. For PCB manufacturing business both local and global demands should be thoroughly studied. Some locations are more ideal than others. For instance, the reason why so many PCB businesses have become a success in China is to do with the huge PCB demand that is available there. 

Supply- Supply research goes two ways: First, it’s important to know what are the current options available in the market for the customers to choose from? How many competitors are already there and what is their potential, their strength and weakness that your business model can overcome. 

Second, supply side research should also focus on the raw material availability, electricity, labour supply, etc that will make up your production cost. 

Pricing- Cost of land, machinery, transportation, running a business overall should be estimated beforehand to assess the capex (Capital Expenditure) required. 

Quantity- What should be the nature of the business model, a small range B2B (Business to Business) or a large scale B2B and B2C (Business to Consumer) business model, this should be clear at the threshold of starting itself because the road ahead will be so forth.

Quality- PCBs are used in a range of applications from robotics in college projects to products as sensitive as medical and defence products. Therefore, having the knowledge of quality requirements will help in raw material selection, licensing, regulations, certifications, testing and various other compliances. 

Required Raw Materials:

PCB manufacturing process starts with exporting Gerber file designs and printing them out to finally silk screening the board and assembling the electronic components thereafter. Therefore, there are various steps involved in completing the manufacturing. 

Solder, flux, chemicals, adhesives, wires, boards for PCB, electronic components like capacitors, resistors, microcontroller, etc are all part of raw materials needed to start a PCB manufacturing business. Who are the wholesalers and retailers available in the market providing these raw materials, their quality, performance and efficiency are all necessary questions that should be addressed at the raw material selection stage. 

Begin by Doing: Machinery and Tools 

Things will work when put to do work. In this the machinery and tools play a critical role. PCB manufacturing is both machines and tools dependent because different processes need different setup. For instance, a wave soldering machine for soldering the components on the board, silk screen stencils, drilling holes, marking vias, etc. 

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Various machines needed are heat wave soldering machine, oscilloscope, LCR-Q meter, function generator, power supplies,digital multimeter, variac and rheostat and various testing machines

Know your Customers:

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From automotive to smart phones, from pacemaker to automated traffic light, PCBs are needed in the functioning of a wide horizon of products. Thus, the customer base is not niche rather a whole spectrum of users with varied needs. Electronic industry, automobile manufacturers, gaming industry, biotechnology, medical, defence and telecom industry, are all potential markets for PCB manufacturers delivering customer specific products. 

Further, the customer range doesn’t only stop at these wholesalers and retailers but also at individual buyers. In universities and colleges students are working on PCB innovation. Just like the Arduino team did, they used 300 students from university as their initial customer base. 

Another option to choose from is targeting online or offline customers, or a combination of both.

Licensing and Regulations to be Considered:

The licensing and regulations can be subdivided at three levels, for the company, for the products and processes and finally for the manpower and labour. 

  • Necessary Licensing for Establishing a Business: As per Indian laws, these include registering of your business, GST registration, land clearances, Udhyog Aadhaar, import-export code, among others.
  • Regulations for Products and Processes: The Manufacture, Storage and Import of Hazardous Electronic Rules, 1989 handles all the necessary regulations pertaining to the electronic industry. Further, NOC from the state pollution control board, ISO certification and trademark are also needed to standardise your product.
  • Labor Laws: Though PCB manufacturing is not labor intensive industry, it demands highly skilled and specialized manpower that is aware of the processes they are working on. Their safety and empowerment should be of utmost importance for the employer. Thus compliance to various labour laws encompassing their economic rights and workplace safety and protection from hazardous substances should be done.

Investment Pool and Strategy:

A PCB manufacturing plant is like a series of machines and tools stationed through which the board passes. Therefore, it needs not only just highly skilled manpower but also investment in plant setup and necessary working capital. 

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There are various investment models available to choose from, partnership, angel investment, hedge funding, are some of the many options available. If your investment estimate puts you down due to huge numbers involved, the silver lining is today there are so many government backed plans and individual investors available who are ready to invest and financially support in setting up your own PCB manufacturing plant. 

Alternatives Available: 

Even if you don’t feel confident or lack capex and experience to start a PCB manufacturing business, take small steps in this direction. While manufacturing is one area to dive into, PCB designing and assembly are other options available to be explored. PCB designing firms require much lower capital investment to get started. All you need is investment in high quality software for designing the schema and designers trained in required skills. 

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PCB Business Alternatives

PCB assembly firms and PCB testing firms work as ancillaries to the whole PCB manufacturing business. They outsource their services, work on contract bases and deliver quality products to their clients. 

There are multiple opportunities and various entry points to get into PCB business. Depending on your level of involvement, capital available, experience and skills, you can choose where to enter from. PCB business is expected to grow 20-25 per cent on an average annually. So no matter from where you enter, expanding over years is always the option available. 

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