In a supermarket, the customers may be confused when they find big price differences on some similar LED light products. For example, the appearances of two LED tube products look almost the same, but there is a 40% price difference on them. By comparing the features, people may find little difference on two LED bulb products, but one bulb is actually much more expensive than the other one.
For the buyers of the LED lighting products, they are always trying to find the best prices for their purchases, as every dollar counts for the success of their business. However, the lowest price for a product is not always the best price. A reasonable price to meet the needs of the premise is considered to be the best price.
One purchasing goal of the buyers is to find the right products at the lowest cost, as this is a critical step to achieve the substantial profits. At the first step of the souring circle, the buyers need to know the details of the products, to see whether the low-cost goods can meet their requirements, especially when they place big orders for the wholesale LED light products.
So how to know whether a proposed price is at a reasonable level? Before making any judgment on the question, the buyers should fully understand what they actually need. Take buying a tablet PC for example. Currently there are lots of brands available in the market, no matter for similar features or different features. The consumers will need to compare the different brands, different prices and different functions. The prices of the tablet PC will vary greatly according to these fields. In making a decision, the consumers usually choose the right features and functions according to their own budgets, and finally buy the correct ones. This practice is very similar to the LED lighting product. The different conformations and materials of an LED tube will result in different prices. Therefore, the buyers are supposed to know the details of the critical cost factors before making the purchases of the LED bulb products.
The cost of an LED light is determined by many factors. Normally, three critical factors can decide the cost. These three key factors are the LED chip, the LED driver and the LED housing.
1. The LED chip.
The LED chip is an important component of a light. It accounts for the highest percentage of the total cost. There are many models available in the market and the prices can vary greatly in accordance with the packages bracket and the wafer. It is normal to find two chips of the same wafer but the price difference can range from 10% to 20%. This price gap can kill a business in the bulk purchases. However, with the technology developing in the past several years, the cost of the LED chip is decreasing continuously, which results in the total cost decline in the finished products.
2. The LED driver.
The LED driver plays a very important part of the LED tube product. It can heavily affect the lifetime of the finished product. Due to the different circuit schematics, the cost of the drivers varies greatly. It is applied to change the input AC or DC to DC power to drive the LED chips. This mode can be achieved in three ways, namely, non-isolated linear mode, non-isolated switch mode and isolated switch-mode.
The non-isolated linear mode is at the very low cost but has some disadvantages. It puts an LED bulb product at high security risk with poor reliability. The worst is that its working efficiency is low, and cannot maximize the energy-saving purpose. The non-isolated switch mode of the LED driver costs relatively low. It works with high efficiency and it is highly reliable when delivering the light. However, this mode is still at high security risk. The isolated switch mode is the perfect mode for a driver, as it at low security risk. This mode can work in high efficiency and reliability when delivering the light. The only disadvantage is that the cost is very high.
The non-isolated linear mode and the non-isolated switch mode cost less but the reliability is poor, which may cause trouble during the customer's usage. This situation will increase the cost of the after-sales. While the isolated switch mode of the LED driver does not have this problem, but it hurts at the high cost.
3. The LED housing.
The LED housing is simply the outer appearance of the finished product. Its cost varies according to the structures and the materials. In general practice, the simpler of the structure, the lower is the cost. This is also true to the size. The smaller size can achieve to the lower cost. In terms of the materials, the aluminum LED housing is much more expensive than the plastic ones.
In summary, the prices of the LED lighting products can vary greatly though they really look almost the same. A wise buyer should pay attention to the major components and know how they affect the total cost. The low cost is never the only consideration for a purchase. The Buyers are supposed to pay more attention to the necessary factors.