how to calculate the cost of a heat treating job? 2

[ht3jyx]

I were just assigned to do cost analysis in a commercial heat treating company. I am new to this industry. In my previous work, I used to start cost accounting by analyzing Bill of Materials. but this company does not have such thing (BOM). So may be I need to develop one for each of their job. Does any one know where to get started? where I can get some template or sample of cost accounting work used in heat treating industry? thanks.

 

[stanislasdz]

hi,

You must first compute the gaz bill evry month
You must analyse the ratio masse per hour of treatment
You may also see the grade of your steel to do a best charge
You may also to analyse what kind of heat reatment (quenching, tempering, normalizing.....
You must analyse also the température et and the time holding (including the time to increase to the maximal temperature).
You must also compute the others cost

Sorry for my poor english ...

Stanislas

 

[ht3jyx]

stanislas

all you said makes sense. have you ever done such work? if so, would you mind to share me your working template such as excel worksheet. if you do so, please erase or change all confidential data.

thanks,

yush

 

[steelmaking]

1. You must calcilate gas or other fuel consumption per each steel grade or groups of similar steel grades.
2. Yoy must know what is the consumtion of the refractories per ton steel.
3. You must know what is the consumtion of the watter for cooling.Uou must know what is the consumption of the electricity
The others you will put like fixed costs.

 

[tripleZ]

Let's add to the water calculation. Does your plant use process water or city water for cooling? My sintering furnaces all pull off a centralized storage tank for cooling jacket circulation when a fast quench is not as necessary. We switch over to city water when we need the quicker quench. There is a cost difference for us at least.

Are you using continuous furnaces or batch furnaces? Hot box size in a vacuum furnace will contribute heavily to the billing rate, as will the gas mixture and pressure used to backfill it (if you do so).

You are not going to get an accurate picture without detailing your system. Plus, for quotation purposes, you need to know what your system's capabilities and limitations are.

 

[stanislasdz]

Question for all :

Is the cost of the heat treatment depend on the mass of the part introduced in the furance....i guess no !

 

[Steve898]

The cost of commercial heat treating is based on what the market will bear. Despite this, you can come to an understanding of your costs. Some jobs make hay, others are just barely worth doing.

For a given profit center, like the nitriding line or the carburizing line, etc, add up all the monthly costs, from gas, electric, water, maintenance, overhead, labor, average alloy consumption, atmosphere, etc. Add up available furnace hours (Usually 620, including Saturday). Divide the costs by the number of available furnace hours. This will give you a general hourly rate for that profit center.

Then you will be ready to analyze a particular job.

Let's say you try to get $100/hour for a Super30 Allcase, a not-unreasonable rate. This includes 1 wash, 1 temper, 1 inspection. This does not include 2nd temper, freezing or other add-ons. Some jobs will be at an $80/hour rate, but you get to put 3 additional minimum orders in that load per day, average. If those minimums are let's say, $75 each, then you got $225 more for that cycle. If the cycle was 3 hours load-to-quench, and you were getting $240 for that load, now you made $465 for that load. (That's $155/hour.)

Straight analysis of the regular run says you are losing $60/load, but that is where you beat the in-house heat treaters, by combining jobs from various customers.

I just go on and on. I'll stop now.

 

[ht3jyx]

steve898,

impressive, i will let you know if i have further questions.

thanks,

Yush