Thread: The Sad truth
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Unread 19-10-2007, 07:22
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Re: The Sad truth

A couple of posts suggest that the larger FIRST gets the more its costs. that suggests that a team cost structure goes up also.

I disagree. I don't think you looking at costs correctly.

Program costs per team actually goes down as the program grows for several reasons.

Fixed costs -
Some items in the FIRST budget are fixed. It doesn't matter it there are 1 or 10,000 teams. As the number of teams increase the less cost per team as that cost is distributed.

Another aspect of fixed costs is in order to create a regional you need a critical mass of teams to support the regional. You are not going to create a regional that has only 5 teams. The fixed costs are prohibitive. But you have to create regionals to reduce logistical costs and make the program more available. An interesting problem currently is there is a lot of growth around Washington DC/Mid-Atlantic area. The Virginia event is basically overloaded. The NC/RTP area is under served and there is no regional in NC and not enough teams in NC. It is logical that NC create an event so Virginia doesn't explode like a steam boiler. But we need some teams in NC.

Variable costs -
For example if FIRST (or their agent has to buy parts to distribute, the transaction costs goes down with increasing volume. Again the savings are passed on. The whole parts acquisition/distribution process is a very significant cost. To learn more study industrial engineering and "supply chain".

Logistical costs -
The more the programs grow, the more regionals there are. More regionals means less distance a team travels to their event. This cost is mainly for variable costs like fuel. Whereas hotels and meals tend to be fixed cost, whether you travel 1 mile or 10,000 miles.

There are plenty of teams that struggle to fund and attend one regional. The bulk of their costs go to FIRST and building the robot. There are some teams that attend 2 or 3 or possibly more regionals and their cost is mostly travel and lodging/food, etc. The only thing FIRST can do there about that is create a million regionals to eliminate overnight trips.
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