cost modelling
Complex Business Decisions
Cost modelling can be used to support and simplify complex business decisions:
- make vs buy studies
- where should i make my product?
- which country should i source from?
- additive manufacturing vs traditional processes
Taking a life-cycle approach ensures robust decisions are made and expensive mistakes are avoided. We have identified and helped to correct several poor decisions made by some of our clients through our cost modelling projects.
Additive Manufacturing (AM) Business Cases
We have extensive experience of costing traditional processes such as casting, forging and machining. We also have a deep understanding of the 7 additive manufacturing processes i.e. Vat polymerization, Material Extrusion, Material Jetting, Binder Jetting, Powder Bed Fusion, D.E.D and Sheet Lamination.
Just like Make vs Buy studies, expensive mistakes can be made if the study is biased one way (this can be down to lack of knowledge). At AMSAB we ensure the cost comparison is detailed and robust for both the traditional processes and AM.
We can create robust business cases for AM (where suitable) and including validation of costs for existing processes and cost modelling for AM processes and post-processes.
Activity Based Costing (ABC)
Activity based costing or “ABC” compared to traditional costing is a decision making tool which provides our clients more accurate cost and profit information and allows decision makers to understand the cost and profit drivers that can be influenced to improve their business.
We can create a virtual cost model of our clients / suppliers factory to calculate accurate hourly rates – which is the important foundation step in our cost engineering / cost reduction activities.
Cost Model New Technology
We helped our Industrial client to develop a cost model for accurately calculating the should cost for products using their new technology.
The model also calculates the cost for making the product using the existing technology.
The model compares the existing technology cost against the new technology and helps the client to select the most cost effective option when bidding for new business.