Step two: calculate the cost of the raw materials Now, it is possible to focus on one of these production cycles at a time. In this way the output of Machine 1 becomes the input of Machine 2, carrying on its production cost as if it were a new raw material. Since production cycles can be so different from one another, and may include different phases, we need to brake the production cycle down to simpler processes, as shown in the picture below. The formulas described in the previous article are meant to calculate the hourly cost and efficiency of a single machine or system. Step one: breaking down the production cycle This is possible thanks to the optimization of raw material utilization (up to 100%), and making maintenance cost even more cost-effective.ĭiscover all the Dallan technologies and the production systems: Roll forming You can find more details related to these concepts into the book “ The Revolution of Efficiency” that you can request here: REQUEST THE BOOK FOR FREEĭallan develops efficient technologies and machines in order to improve the production cycle and to break down production costs. Here, I will use some of the concepts and ideas of these articles and propose a method to estimate the production cost of a single sheet metal product, and of a full batch. ![]() We have always to bear in mind, that the result of the calculation will be affected by all these decisions. We have seen how some of these parameters, for example the Efficiency of a machine or its Hourly Cost, depend from a number of estimations and strategic decisions the entrepreneur has to take. ![]()
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