Cost and benefit analysis

Cost-benefit analysis: Manual deburring vs. Plasma electrolytic Polishing (outsourced)

1. Previous Situation: manual deburring

Costs:

  • Labor Time: Manual deburring is time-consuming and requires skilled labor. Costs are primarily driven by wages and the time needed per component.
    • Average time per product: High due to intensive labor.
    • Labor costs: Estimated based on the number of working hours employees spend on manual deburring.
  • Consistency & quality
    • Risk of variation: Manual deburring can produce inconsistent quality depending on the operator's experience.
    •  Post-processing: May be necessary in some cases, adding extra time and costs.
  • Material loss & damage: Manual deburring can result in micro-damage, negatively affecting product accuracy.

Benefits:

  • Initial investments: Manual deburring requires minimal upfront investment in machinery and can be done with basic tools.
  • Flexibility: Manual deburring is flexible and can be easily adjusted for small production runs or irregular orders.

 

2. New Situation: Plasma electrolytic Polishing (outsourced)

Costs:

  • Outsourcing costs: PeP is outsourced, so costs are per unit for the polishing process. Although initially higher than manual deburring, these costs are fixed and predictable.
    • Estimation: Outsourcing saves 25% to 30% in time, leading to a reduction in labor costs compared to the manual process.
  • Transport costs: There may be transport costs for shipping products to the external supplier. 

Benefits:

  • Labor and time savings: By outsourcing, the company saves 25% to 30% of the time previously spent on manual deburring. This results in lower labor costs, reduced wage pressure, and faster production times.
    •  Production efficiency: PeP is faster than manual deburring, increasing throughput.
  • Consistency and precision: PeP delivers a consistent, precise finish, even on complex geometries, reducing the need for post-processing and inspection.
    • Fewer errors: This reduces costs associated with product rejection or revisions.
  • No residue & cleanliness: Of all the alternative methods, PeP is the only one that leaves no residue on the product while shortening lead times. Lucassen’s customers demand no contamination or residue from processing methods, making this a significant improvement.
  • Higher quality: Improved accuracy and surface finishing lead to higher product quality, potentially increasing sales prices or customer satisfaction.
  • Sustainability: The PeP finish enhances corrosion resistance, extending the product lifespan, which is appealing for demanding industries such as medical and aerospace.

 

3. Comparison: manual deburring vs. Plasma electrolytic Polishing (outsourced)

Aspect

Manual deburring

Plasma electrolytic Polishing (outsourced)

Labor Time

High

25%-30% time savings

Costs

Lower per unit, labor-intensive

Higher per unit, but more efficient

Accuracy

Variable (operator-dependent)

High

Complex shapes

Difficult to process

Highly suitable, even for complex geometries

Material loss

Risk of micro-damage

Minimal material removal, no damage

Finish quality

Inconsistent, operator-dependent

High burr reduction and excellent finish

Investments

Low initial tool costs

No internal investment due to outsourcing

Transport costs

N/A

Transport costs to supplier

 

4. Conclusion: cost-benefit analysis

PeP offers significant advantages in terms of consistency, accuracy, and cleanliness, with labor and time cost savings of 25% to 30%. While the initial outsourcing costs may be higher, the process yields long-term savings by improving product quality, reducing post-processing, and lowering the risk of product rejection. For complex products or components requiring high precision, PeP is the more efficient and sustainable choice, despite the higher outsourcing costs. In conclusion, PeP aligns with high-tech industry demands for precision, cleanliness, and speed, making it a preferable solution for Lucassen Group’s needs, particularly for customers like ASML who prioritize product purity and quality.

 

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