Author: Dave Ferguson

February 14, 2019 Dave Ferguson

Job shops, including MTO, ETO, and the different variations, deal with RFQs on a daily basis. An RFQ is a Request for Quote. There are various terms that describe a similar process; for instance, an RFP or Request For Proposal.  

RFQs have a dual meaning based on the hat you wear. If you are a customer that requires widgets to be made by a supplier, then you submit an RFQ to that supplier. Sometimes, an RFQ is submitted to suppliers based on the needs of the RFQ from a customer. The supplier then responds to the RFQ. The result of an RFQ should be giving accurate pricing back to the customer in a timely fashion. This is critical in being awarded that job. Quoting and estimating is where the pricing will be calculated accurately and efficiently.

One great tool that an ERP system offers is the ability to track RFQs throughout the process. RFQs start off in draft mode and are assigned to an estimator. As the estimator begins to work on the RFQ and come up with detailed costs and pricing, the status changes to “in-process”. This gives management the ability to see all RFQs that are in-process, which gives an accurate view of the work load. Once the RFQ is complete, an approval process can begin by moving it to a “pre-approval” and, finally, “approved” status. Lastly, the RFQ can be submitted to the customer with confidence that the quote was accurately made with the all proper approvals in place.  An advantage of tracking RFQs through their workflow is to have traceability, the analytics of time spent, number of RFQs that received a response, and capture rates. An ERP system should be able to efficiently track this workflow and create graphical, real-time management dashboards with minimal effort. Once the RFQs have been responded to, the waiting begins. When you are awarded the RFQ, it flows through the manufacturing process based on the up-front effort to track the RFQ. ERP systems should automatically calculate the capture rates of RFQs in order to record proper analytics for both the estimators and customers.

MIE Solutions Inc. provides an all-inclusive RFQ to Quote to Order workflow that is efficient and easy to use.

December 10, 2018 Dave Ferguson

As technology has improved over the years, paint lines have become more commonplace throughout job shops. The ability to estimate how much a part costs is now more complicated due to the batch process and automation of paint lines. This entry will show you a sample formula for estimating “time per part”.

Variables

FeetPerMinute

VerticalParts

PartWidth

PlugsPerPart

MaskingTimePerPart

These variables including your hourly rate running your paint line is a pretty basic formula.  Depending on how the parts are hung, you can get more parts done on the hanger then a single part.  The PlugsPerPart and MaskingTimePerPart are for individual parts and would not be multiplied but the vertical parts.  The feet per minute can actually be broken down into a formula by itself.   The feet per minute is based on cure time, thickness of the powder coat and other factors.  The most difficult part is actually how you determine your shop rate for the paint line.

 

 

 

December 4, 2018 Dave Ferguson

What is a paint line?

Paint lines comprise equipment that cleans, dips, sprays paint, and ovens to dry the parts. Paint lines are very capital-intensive and often take up hundreds to thousands of square feet of space. They can be both wet paint or powder coat systems.

 

 

Why do we need a formula for paint line estimating?

Paint lines are very costly and, therefore, you want to be able to make your money back from this large capital investment. Not only do you want to earn your money back but you want your pricing to be competitive in the market. Many job shops seem to now have their own paint lines instead of sending their manufactured parts to a painter. Suppliers who have done their own painting for years have developed formulas or techniques, which they use to estimate jobs. For accurate costing, job shops must now have formulas for the jobs requiring paint lines; this is especially important if a shop wants to be both profitable and competitive in the market.

Estimating has become more of a science than guesswork. Some goals of estimating are to have repeatable processes and consistent costs. Below, you will find specific variables that make up a formula for costing paint lines. Some of the variables include adjustments for special situations, like odd-sized parts or if the line has to go at different speeds.

Time To Reach XXX degrees

Cure Time

Cure Temp Adjustment

Parts Per Set

Linear Feet Per Set

Cure Temp

Conveyor Speed Override

 

The next post will cover the actual formula that will be used with these variables; this should help us determine accurate costing.

 

December 22, 2015 Dave Ferguson No comments exist

Do you wonder what your shop’s burden rates are for working 8-hour days but having only 4 hours of work to do? Do you charge your customer for all 8 hours? There are some companies that will charge for 8 hours of work even when there was only 4 hours of labor on a job. This gives an inflated cost to the product and may, thus, give it the appearance of not being profitable when, if fact, it was profitable. The unused time must be classified as idle time and its costs should not be attributed to a specific job cost or product family.

This unused time should be calculated and given to management in order to plan, schedule, and manage the company. Some situations where this may happen is when material is late, a machine broke down, etc. When this happens, management should be aware and may be able to change processes to make the shop more effective.

 

October 29, 2015 Dave Ferguson No comments exist
Here are some key aspects to quoting and estimating.
1. Material costs
This includes both raw material and purchased components like nuts, bolts, screws, etc.
2. Tooling costs
3. Welding fixture costs and other fixture costs
4. Burden rate of the machine(s) the part runs on
5. Overhead (Indirect Labor)
6. Insurance
7. Depreciation
8. Labor
9. Utilities
10. Other consumables
11. Taxes
12. Payment Terms
13. Complexity of the part and the tolerances to be held
14. Inspection Requirements
15. Documentation requirements
16. Other costs of quality
17. Other overhead (rent, etc)
18. Engineering Costs
19. Installation Costs
20. Administrative staff salaries and commissions
I’m sure I’m missing a few…..

July 10, 2015 Dave Ferguson No comments exist

Punch press estimating is a very common way to put wholes in sheet metal parts. Punch presses have been around since 1955.  The Wiedemann Machine Company was established in Philadelphia, Pennsylvania in 1916 and over the years developed and produced a variety of machines. Wiedemann unveiled the world’s first NC turret punch press at a machine tools show in Chicago in 1955.

PunchPress

CNC punch presses are very common and still outperform laser in many scenarios in speed.

Punch press formulas for estimating usually ask for number of hits, tools and thickness of material.   You can see a sample formula below which can be changed based on your machine capabilities.

PunchPressFormula

((onehit*.0008*((thickness*2)+1))+(nonstand*2*.0008*((thickness*2)+1))+(perimeter/668*((thickness*2)+1))+(((length/4590)*2*tools)+tools*.05))

April 22, 2015 Dave Ferguson No comments exist

Laser cutting sheet metal parts is very common in the industry.  Not too many years ago laser cutting was new and estimating the costs was new.  Now, laser cutting estimating has become much more accurate through software simulations.

The simplest way to estimate laser cutting time and material is using the actual laser programming software like Metacam by Metamation.   A flat DXF file can be loaded into the software and the software will accurately estimate the laser time based on a simulation  cutting the part.  The part can actually be nested giving you a more accurate time cutting the parts from a nested sheet.  Once the estimated time has been calculated you would enter that time into the cycle time of the nesting software to calculate your costs.  The Gas, Depreciation, Utilities would be included in your overhead rate of the machine which in turn gives you the cost to run the part.

There are other situations where you do not have a  good DXF file and you must estimate by estimating the number of inches, pierces, cut speed, etc.  The screen shot below shows where you would create an a formula and use the formula to enter values.  The formula would have to be customized for your specific machine and manufacturing process which in turn brings consistent estimates.

q1

Lastly, a calculator can be created to assist you in calculating the number of linear inches of cutting as shown below.

q2

There is a nice article here.

//www.thefabricator.com/article/plasmacutting/estimating-your-cutting-costs

April 6, 2015 Dave Ferguson No comments exist

The standards for estimating saw operations includes both the actual sawing operation and the setup of the jig, clamps, etc.  The times below are in seconds.  These process times may change based on the machine and if its a manual process, etc.  In your software you should enter the different processes into the saw operation with the standards which you determine are correct for your business.   ERP Software for the manufacturing business should be able to calculate the cycle times once you enter your standards into the system.saw

Process Seconds
Brush Chips Small 7
Burr, Inch 12
C Clamp Small 10
C Clamp Large 20
Cutting Oil 2
Feed 3
Guard Remove 6
Small Unload/Load <12 Inches 5
Manual Feed Stock 10
Oil Part 5
Start/Stop 2
Visegrip Wrench 3
Large Unload/Load >50 Inches 30
Air Blast 5

The cycle time of cutting is more dynamic based on the material type and cut length.  There are also automated saws which you program in the different cut lengths required and the automated system sets the gauge in order to optimize the material usage based on the requirements.

In order to calculate the cycle time based on material you would use a formula as shown below

(Material Type Feed Rate) * Number Of Inches Of Cutting.

If the material cut speed was 30 inches a minute and you were cutting 60 inches, the total time would be

(1/(InchesPerMinutes))*(Cut Length)

(1/30)*60 which gives you 2 minutes of cycle time.

March 30, 2015 Dave Ferguson No comments exist

Process Automation on the Gears.Engineering standards for estimating is critical in order to come up with a consistent way of quoting.   Standards are based on time and not dollars because shop rates are different based on each individual company.  Standards are different based on machines and skill which are relatively consistent.

Engineering standards shown are for the metalworking industry and can be adjusted based on your machines and skill level.  Software has improved greatly in the last few years with software from vendors such as Metamation Inc., Sigmanest  and others.

Sheet Metal parts take about 20-60 minutes to program or 3 minutes per 1 minutes of machine time.  CNC Lathe parts take about 20-60 minutes to program or 10 minutes per 1 minute of machining.  Machining Center takes 4-40 Hours or 30  minutes to program 1 minute of machining time.

Tool design for fixtures, drill jigs, welding jigs, etc has been approximated that the manufacturing time and cost will be 2 times greater.

You should create a spreadsheet for estimating that uses the standards shown or use an estimating software like QuoteIt! from MIE Solutions to enter the formulas which best match your requirements.

www.mie-solutions.com

March 26, 2015 Dave Ferguson No comments exist

Mie Solutions Estimating Engineering

The estimating process is just that, its an estimate or an educated guess.   Companies many times will add to the beginning of a quote a process step called Engineering.  Engineering can mean many things including

  • CNC Programming
  • Design Work
  • Creating Solid Models
  • Creating Prototypes

During the estimating process it is key to include these costs into your quote.  Things to consider is this charge can be either amortized into the unit costs or as a separate charge.  The nice thing about amortizing the costs into the piece price is that a repeat job your profit will go up because this tasks has already been complete.   A separate charge has the advantage of lowering the price to the customer for future job orders which may give you a pricing advantage in the long run.

Hourly cost for these engineering tasks need to be taken into consideration based on the cost of the employee completing these tasks.

Lastly, a key consideration if you do lots of engineering work is becoming a partner which gives you a head up on your competitors.

Take a look at an ERP system that handles engineering tasks at

www.mie-solutions.com