NRE (Non-Recurring Engineering) is one of the most misunderstood parts of electronics development. It’s the cost of getting your product from idea to something that can actually be manufactured—reliably, repeatedly, and affordably.
Not sure what NRE actually includes? Here’s a breakdown of what NRE really means and what it covers.
We’ve worked with dozens of clients who didn’t budget for it properly. Some didn’t know what was included. Others thought they could skip it altogether.
Here are five common NRE mistakes we see again and again—and what they really cost.
1. Thinking NRE is just a deposit, not real work
Let’s start with the biggest misconception:
“We’ll pay this upfront, and you’ll credit it back when we go into production, right?”
No. NRE is not a deposit or placeholder. It’s payment for actual engineering time and development work.
When you pay for NRE, you’re paying for the hours that go into designing your PCB, writing firmware, sourcing components, designing enclosures, building test jigs, debugging prototypes, and preparing the files for volume production. That work doesn’t magically go away once production starts.
If the NRE is $40K, that’s because there’s about $40K of labor involved. Whether you make one unit or one million, the effort doesn’t change. It’s sunk cost.
Lesson:
Treat NRE as a business investment. Don’t expect to “get it back”—expect to get a manufacturable, working product.
2. Underestimating how much NRE is actually needed
This one happens all the time. Someone sees an NRE quote and says,
“$60,000? That’s too much for just design.”
But they don’t ask what’s included. In reality, that amount might cover:
- PCB layout and design for a complex 4-layer board
- Two prototype revisions
- Embedded firmware with Bluetooth and battery management
- Design of custom injection-molded plastic parts
- Test jig design for factory QA
- EMC simulation and certification prep
That’s not “just design.” That’s multiple engineers working full-time for 2–3 months.
We’ve also seen projects where the client tried to shave $10K off the NRE and ended up spending 3x more fixing issues down the line. Skipping test fixture design or DFM reviews might save a little upfront, but it’ll cost you in delays and failed batches.
Lesson:
Don’t compare NRE quotes unless you know what’s actually included. Hidden scope is a common reason for cost blowouts, especially when clients underestimate what’s actually involved.
3. Trying to avoid NRE by using dev boards or off-the-shelf modules
Here’s a real example: A startup came to us with a working prototype built on Arduino. It functioned, but:
- The board cost $25 in low volume
- It had no RF shielding
- It failed basic EMC testing
- The BOM included hobby components with no traceability
The client thought this was “90% done.” In reality, we had to redesign everything from scratch to meet cost, compliance, and assembly standards.
Dev boards are great for demos and internal proof of concept. But they’re not built for volume production or regulatory testing.
And using certified modules instead of designing your own may save some NRE—but you’ll pay for it in per-unit costs and supply limitations.
Lesson:
Use dev boards for learning. Use real design for shipping products.
4. Designing in isolation without involving your manufacturer
We once received files from a client who had finished their product with a local design firm. It looked polished. Then we tried to build it.
Problems:
- Main IC was EOL
- Board had no test points
- Plastics required side-action tooling that doubled mold costs
- 30% of BOM had 30+ week lead times
None of that was visible in the CAD or schematics. But it all came up once we looked at it from a factory point of view.
When you design without a manufacturer’s input, you optimize for function—not for sourcing, assembly, or testing. DFM principles exist for a reason, and ignoring them usually leads to a second round of redesign.
Lesson:
Design for manufacturing, not just for appearance. Bring in production engineers early—or use a team that does both.
5. Assuming one-time NRE means the product is “done” forever
Many clients think once they’ve paid NRE, that’s it. No more engineering costs. Product’s done. Ready to go.
Then reality hits.
- A component goes EOL and the board needs a respin
- Customers ask for USB-C instead of micro-USB
- EMC testing fails and shielding must be added
- A mechanical tolerance issue shows up after 5,000 units
All of these require new engineering work. That means more NRE.
Electronics development isn’t static. Your product will evolve—and so will your design files, test plans, and production setup. Component obsolescence alone can force major design changes mid-life, especially in long product life cycles.
Lesson:
Leave room in your budget (and expectations) for post-NRE tweaks. The first build is rarely the final one.
Final Thoughts
NRE isn’t a hidden fee. It’s the foundation of your product. If you shortcut it, you’ll get stuck in redesign loops, miss certifications, or end up with a product that’s too expensive to build.
At Titoma, we don’t treat NRE as “optional.” We treat it as part of the process of making real, reliable products. And we bake in manufacturing needs from the start—so you don’t pay twice.
If you’re not sure whether a project is worth the NRE, start by reviewing your bill of materials for red flags or looking at how flexible your design is to relocate production if needed.
