- July 03, 2025
You have built a promising embedded product. The prototype works, the demo went superb, and you are ready to scale—or so you think. But as you prepare for mass production or your next funding round, you hit a wall: your margins are thinner than you expected.What went wrong and where?
For many hardware founders, it is not the big decisions but the small, early design choices like over-engineered hardware to firmware inefficiencies, that quietly hurt profits. These hidden decisions can increase your BOM, raise costs, and shrink margins before your product even launches.
BOM bloat happens when your bill of materials includes components that are over-specified, redundant, or simply unnecessary. It is one of the most common—and costly—embedded hardware design mistakes.
Every extra dollar in your BOM multiplies across every unit you ship. A $5 unnecessary component in a run of 10,000 units is $50,000 straight off your bottom line.
A System on Module (SoM) is a powerful shortcut for embedded development, but it is easy to over-specify. Many teams select high-end SoMs just in case they need extra performance or features, but this decision can lock in excessive costs.
High-end SoMs can add $10, $20, or even $50 to your per-unit cost. Over a production run, that is a margin killer.
Adding sensors and peripherals can make your product seem more capable, but each addition increases BOM cost, complexity, and risk.
Every sensor or peripheral adds direct cost, increases firmware complexity, and can introduce new points of failure. Worse, if these features are not core to your value proposition, they rarely justify their cost.
Firmware that is not optimized can force you to use more powerful (and expensive) hardware, larger memory, or bigger batteries than necessary.
Inefficient firmware can require you to upgrade to pricier microcontrollers, add more memory, or increase battery size—all of which inflate your BOM.
Design for Manufacturability means designing your product so it can be easily and cost-effectively manufactured at scale. Overlooking DFM leads to higher assembly costs, lower yields, and more expensive production.
Hard-to-assemble designs increase labor costs and reduce yield. Non-standard components can create supply chain headaches and price volatility.
Every embedded product founder faces tough decisions under pricing pressure. But the most dangerous margin killers are often the ones you can’t see—until it is too late. By proactively reviewing your BOM, questioning your SoM and sensor choices, optimizing firmware, and designing for manufacturability, you can reclaim lost margin and build a more scalable, profitable product.Book a BOM audit or redesign scope call today. Our team will help you uncover hidden cost drivers, streamline your design, and set your product up for scalable, profitable growth.