Our product timeline, and an update on how COVID-19 has affected global supply chains.
Jacob Flood, April 16 2020
March has led into April, with everyone at Mindset feeling appropriately tense. With the world changing so drastically these past weeks, we’ve been working hard to keep our development schedule on track while practicing the required social distancing.
This update we’ll be going through a brief rundown of how COVID-19 has been affecting ours (and everyone else’s) supply chains, giving a sneak peak of our new branding, and updating you on the schedule for our next production run.
Our next production batch is still on schedule to be assembled at the end of this month, and shipped out soon after. A word of caution: shipping times have been significantly delayed recently (see more below).
We’ve also begun mass production of the first thousand shipping boxes. See below for a peak at our new branding, which will be releasing later this month!
As we discussed in our last update, we are still working hard to mitigate the effects of COVID-19 on our production. Throughout the past month, we’ve been in limbo waiting on the shipment of several critical components we need to begin production. We’ve spent this time working on other parts of the company: shipping boxes, branding, and software.
We are still operating on the same timeline as last month: the next batch of 100 units will be produced last this month, and will ship out immediately once complete.
Naturally, we are not the only company affected: the whole hardware ecosystem has been impacted by these changes. Aside from the necessity of remote-work infrastructure in engineering companies, the primary impacts on hardware manufacturers has been with respect to component availability and shipping timelines.
Currently, our factory is nearly fully operational again. We have fully resumed our schedule of meeting with our factory each week and working with their engineering teams on the preparations for the next batch. At this point, the main disruptions are coming from limitations placed on import and exports. These limitations are due to increased regulations imposed by local and federal governments to limit the spread of COVID-19.
Across the supply chain, these limitations are manifesting in two key ways:
1. The sourcing of key components
Original manufacturers of key components – for which there are very few replacements available – are facing production and shipping delays. For example, the lead-time for a component that would typically be as high as 16 weeks has been delayed by an additional 10 weeks. In our case, the extremely long lead-time parts for our next several batches were ordered late last year. Several lower lead-time components however, such as the batteries in the headphones, were extended from 15 days to 45 days. Since production can’t start until all components have been received, it’s often the case that a single component delay will become the rate-limiting factor in a whole batch of products.
Needless to say, no companies had planned for as significant of a supply-chain disruption as COVID-19 has been. We pushed hard on our suppliers to fulfill the orders as quickly as possible, but we were often competing directly with all other electronics companies trying to access the limited supply of goods. As is usual, smaller companies with limited leverage are often the worst-hit during times of increased competition.
2. Exporting of goods
Once the products are fully assembled in our factory, we’re unfortunately still not out of the woods. While domestic shipments within China are working very effectively, as we start exporting out of the country, we are facing additional limitations. Lots of demand and little availability leads to the following two challenges:
Firstly, we’ve seen significant increases in the projected lead-times for shipping products form China internationally. The logistics chain has been overburdened to keep up with the increased demand for medical supplies and the increased trend of online purchasing. As a result, logistics firms can no longer be relied upon to fulfil their guaranteed delivery dates.
Secondly, the prices for international shipping have increased dramatically as the economy adapts to the shift in supply and demand. A second-order effect of this is that the typical last-resort shipping options that cost more but guarantee fast delivery have become prohibitively expensive and are reserved almost exclusively for medical supplies. As a result, many hardware companies are being upfront about the fact that they cannot guarantee a precise delivery date anymore.
For those reasons, it is very difficult for us to provide any clear timeline on when shipments will arrive to their final destinations. While we’re confident that the next batch will be ready in a few short weeks, we don’t have a precise date for when those units will be shipped to beta testers. We are in ongoing discussions with our 3PL to figure out the best way to handle outgoing shipments given the current uncertainty in the supply chain, and we’ll do our best to provide you with most up-to-date information through comments as we go.
As we mentioned in previous updates before this crisis struck, we’ve been starting to prepare 100 units to provide to backers and to pass certifications tests. While there were many delays due to COVID-19, we are now finally finishing those units, which are scheduled to be completed by the end of this month.
The purpose of this manufacturing run is to evaluate our current ability to produce the units, as well as to establish the yield rate: the percent of units that meet the specifications. We will be using automatic test jigs and mass production processes to produce those units. This test batch will allow us to ensure that our manufacturing processes yield defect-free products reliably. We are not expecting any major problems based on the latest manufacturing batch. However, we always prefer to remain careful.
Once this batch has been completed, some of the units will be subject to another round of reliability tests. If those tests are successful, then all subsequent units will be considered final, and ready for the market. This manufacturing run will be a good test of our ability to find defects on the assembly line, and to fix them. This involves many different tools that can test on-the-fly each aspects of the product, from the sound tuning, to the ANC performance to how well the electrodes can clip into their socket. Nothing is left to chance. Because our product is unlike any other headphones done before, we had to develop novel ways of mass testing the devices, especially when it comes to validating the EEG functions.
Very few adjustments were done from the previous batch – simply minor tunings to improve reliability and assembly. In addition, we were able to incorporate a few tweaks to the EEG system to improve the performance. With the previous prototype batch, we were able to better evaluate the performance of the product in the hand of alpha testers. This allowed us to incorporate small changes that have yielded noticeable increase in performance. These changes did not have a significant impact on the performance of our system in a good environment but focused on keeping a high performance in environments affected by more electromagnetic noise.
We’re incredibly excited to get our hands on these units, and start shipping them to our beta testers. To those who emailed us to be part of the beta test, thank you – we’ll be reaching out soon to confirm addresses, and coordinate to ship the units. We’ll be sure to share pictures of the units as they’re produced!
In parallel to all of this, we have been preparing the packaging for the product.
Sneak peek at our new branding!
The new box art!
The packaging is often treated as a product on its own, and requires a similar amount of diligence and engineering. We’ve gone through several iterations of the packaging already (as you’ve seen in previous updates), and we’re finally ready to show off the final result. This also gives a sneak peek of the new branding that we’ll be releasing soon.
The image above shows why iteration is so important at every level of manufacturing. The box on the right is nearly perfect, except for color fading at the corners. This was fixed in our recent iteration, on the left!
We’ve finished the test sample, and will be starting to mass produce the first thousand boxes within the next few days. We’re very excited to be so near to shipping!
In parallel, we’ve been spending a lot thinking about remote work, and how our understanding of the value of focus changes when people start working remote. If you have ideas about how focus changes when you move from an office to a work from home setup, please share them in the comments!
One insight we’ve found is that as many as 54% of employers believe that their teams lack the proper tools they would need to prioritize focus. As a result, we’ve been pleased to learn that in this new age of remote work, more and more companies are offering stipends to employees for work tools that can improve their productivity. Moving forward, we intend to strongly encourage employers to take responsibility for this core part of work experience, and continue providing their teams with tools like eno to improve focus.
Our marketing team is working on a series of blog posts about this issue. We’d love to hear what you think. If you are interested, we’d really appreciate if you’d take ~4 minutes to answer a few questions about your experience with work from home. If you have any additional thoughts or questions, feel free to also post them in the comments and we’ll have a discussion!
That’s all for now!
Thank you again for your support. We wish you all good health to you and yours in these difficult times. Stay safe!
Lots of love,
– The Mindset Team