Be Careful With Dollar-Per-Pound Analysis
Have you ever used a cost-per-pound analysis to determine the cost and competitiveness of your castings and foundry sources? It’s simple to run a quick analysis of your part numbers on a spreadsheet with a column for casting cost, one for casting weight, and one for price per pound. You will quickly discover that the costs per pound for your castings vary widely. Remembering that your foundry sales contact once told you their average cost per pound was X; some of the prices you are seeing are X + 400%! How could this be?
What I have described above is a pitfall of judging cost competitiveness between foundries using the dollars-per-pound analysis. To understand what is happening here, let’s take a closer look at several of the most common items that make up the per-pound cost of castings.
The dollar-per-pound analysis may show that several similar parts have widely varying costs. One of the main impactors for casting cost is the number of castings that can be produced in a mold, often referred to as cavities or impressions per mold. Common sense dictates that if you can get multiple parts cast in one mold, the part cost will be less than a single part cast in a mold. Several items should be considered to determine the number of mold cavities.
Casting weight influences the number of parts per mold because each foundry has a targeted poured mold weight that they have found to be ideal for their process to run smoothly. While it may be possible to put more castings in the mold, exceeding the desired weight range could slow the process or potentially increase scrap rates.
The casting must have a gating system attached to it that will provide a location for the down sprue and runner bars that ensure correct flow of metal into the mold cavity. There will also be risers that provide the correct amount of feed metal to produce a sound casting. Any core prints (areas that support a core in the mold) also need to be accounted for. This entire system needs to be placed within the mold with enough sand space allowed between the cavities so hot spots are not created. A sufficient amount of sand also needs to be allowed between the mold cavity and the outer surface of the mold so there is no risk of the liquid metal breaking out of the mold.
Mold yield is the percentage of good castings produced in one mold divided by the total weight of metal poured into the mold. Mold yields vary greatly depending on the amount and size of risers and gating required to produce a sound casting, so a higher yield percentage offers the chance for a lower casting price.
Another common cost driver is the amount of consumables required to make the casting. Riser sleeves, filter cores, ceramic gating tiles, core rods and chaplets all factor into the cost. While not a consumable, metal chills are often used to promote directional solidification of the metal in situations where the casting design is less than ideal. Their use increases the casting cost because, much like any of the consumables listed prior, they need to be placed in the mold, inventoried and managed through the manufacturing process.
With these factors in mind, it becomes easier to see why analyzing the competitiveness of a casting based on cost per pound doesn’t work very well. Many variables are in play, and each foundry will have its own unique requirements that can have an impact on the cost per pound.
However, there is a positive side to this type of analysis that I have used often. When I am comparing costs within a particular foundry, I often use cost per pound to build a Pareto diagram and identify castings that have a price per pound that is much higher than the other castings. This always leads to additional cost analysis and investigation. Approaching your foundry supplier with a request to understand cost drivers and help to eliminate them is a much better way to open discussions and is often more productive than telling the supplier that you need a cost reduction from them. CS