Posts Tagged ‘quoteit’

Engineer To Order Material Costs

Now that we have been investigating many of the details of material costs in quotations, we will now take a look at the mathematical calculations required. Engineer To Order Material Costs Step 1)  Determine the quantity of parts required.   This is the number of parts required to make the end product.  In many situations…

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Material In Cost Estimates Weight Calculation

Material costs in job estimates can come in a variety of ways.   When you are estimating the cost to manufacture a product and the product is made out of either plate material, sheets, tubing, etc there are a few calculation methods that may be required. Here is a list of 7 calculation methods which…

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Indirect Material Costs

Indirect material costs are those that are not directly added into the product. There are many times where materials are required to manufacture a part but are not put directly into the product.  Examples of this may include oils, lubricants for machines, sandpaper, molds, and castings. There are some situations where the molds and castings…

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Material Cost

Material cost is a big subject and will be handled in multiple blog entries.  Material costs are costs that go directly into producing the desired product.  Material costs can be divided into both direct and indirect material costs.  We will focus on direct costs because they directly affect the product’s price. Material can also be…

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Manufacturing Costs

Manufacturing costs consist of multiple elements which arrive at the full cost.  When estimating a product to be manufactured the entire costs are distributed between the following elements. Material Costs – This includes both raw materials, which is reshaped, formed, etc to produce the item and purchased prefabricated items, like nuts, bolts, screws.  The raw…

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Direct and Indirect Costs

Fixed and variable costs can now be broken down into two more cost types: direct and indirect costs. These classify the costs of parts being manufactured and are critical to calculating shop overhead rates.  Direct costs are those costs that are directly associated with the production of the product.  Indirect costs are those costs which…

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Fixed and Variable Costs

There are two main types of costs – fixed and variable.  If something is being manufactured, it consists of both fixed and variable costs.  Fixed costs are those that do not change based on a quantity.  This means the cost is fixed if you produce 1 or 1000 pieces.  Some of these costs would be…

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Techniques for Cost Estimating

The basic cost estimating techniques involve analyzing all factors that make up a cost estimate. The first technique I would follow is to go through the following steps, systematically, and costing each one out in detail. Once you have gone through the basic steps, you will have all the cost information required for the estimate. 1.…

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Purpose of Cost Estimating

There are numerous purposes behind cost estimating, including the following: 1. A manufacturer can determine if the project or product is cost-effective to the manufacturer prior to the manufacturing process. 2. There are various alternatives to manufacturing and cost estimating can determine the economic feasibility of manufacturing the project or product by different methods 3.…

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Estimating the Costs of Estimates

An interesting situation when creating estimates is determining which estimates to spend time on and which estimates are too costly to put the effort into.  In a tough economy, your company takes on jobs that don’t lead to a reasonable profit, but you will do almost anything to keep your machines busy.  This is a…

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