how to calculate the new product cost

These things are best investigated locally, as the circumstances in which the costs are accrued are transparent to all CR4 readers other than the original poster.

Contact various distributors who supply locally and ge them to provide you with an estimate for the parts cost.

That's a huge question , but there are different molding ways involved.

Sheet for plastic are something about extruding molding, normal calculating way is :

Material + Processing cost

Material = Weight (kg) * unit price

If needs to know every yard's , there is a common formular to follow

While Weight (kg) = Width (Inches) * Thickness (mm) * Coefficient

Coefficient is different based on material, like PVC soft sheet around 60 degree hardness, the number is 0.029 or 0.032.

For processing cost, that really depends on different locations about salary , machine cost and depreciation way of machine's value. And even power fees. Basically in China it plus 10~20% for processing cost, you may consider in this way.

PC material is the same but I don't know the coefficient. You may caculate by yourself because that is just a thing about the density of material.

About tooling cost this might be hard to tell, a width in 60" may cost USD40,000 ~50,000 with complete rollers , embossing rollers and etc.

For metal sheet that is totally different story because some made of "Rolling way" and some made by extruding way directly, like Rolling steel sheet, we plus only USD40~50 for each tone of raw material (rod or something) if the q'ty is consideratble, different place has different price for steel , now days the steel sheet around 0.6mm is about USD1250~1300/tone, other thickness more or less different.

That's big question anyway you should look into detail for specific product and different molding way. Plastic Injection parts is calculated in another way but basically all are based on machine depreciation, labor costs and overheads.

thank you sir

but

inventory carrying cost involved or not? if means what is %

Regards

Dinesh

Hello,

I see its been awhile since this thread has been finished but I thought I would ask another question. I'm trying to see if the factory I'm buying PVC from is giving me the correct stuff and I was wondering if you could help me figure out how I could go about testing this. I just want to cut some from a roll they gave me and then measure if it is really .75mm material. I figure there has to be some way I can do this by knowing the weight and dimensions of the material that I cut. I'm just not sure how I can get back to the thickness. They use embossing on the material so I can't just measure the thickness. I can only go by the weight. It is a soft PVC used for inflatables, like lounges and rafts, I'm not sure what the degree of hardness is or how to find out. If you can help out at all let me know. It would be much appreciated.

Thanks,

PK

as far as I know Inventory cost or we called "inventory interest cost" was not a Pre-calculate cost item but "Post-calculating" item, in cost accounting way this should not be calculated inside when quote the price or analyse the cost.

Because even you can not calculate the inventory interest cost directly since in accounting speaking, it has been posted to other account like "buying cost", "material cost" and "account payable", normally not all company will calculate the inventory interest cost but only if there is a cost accountant will do that work so detail.

best rgds

Jason

When I was working in manufacturing the engineering team would come up with the actual part costs.

The accounting team would come up with a cost based on the engineering costs and the amortisation of all the overheads.

The marketing department would then look at what they thought the market would be prepared to pay. For replacement parts on expensive items, such as a new gear shift knob for a car, the price was many times the actual cost.

The moral of the story is that cost has little to do with price unless there is someone else with the same item out there in the market place.

BAB.

Whatever are you talking about?

Would it be cost you have incurred, or would incur, in production and distribution . . . so that what you're really asking about it Price?

Or are you trying to assess prices from suppliers in order to determine your costs? Or something else?

Such is these . . . needs to be clarified, otherwise the question makes little sense.

If you are a producer, it would help to know the scale in other than ambiguous terms such "Qty." Are we talking large or small scale runs? Or cottage enterprise.

Finally, some education in business administration and accounting, or hiring someone with those credentials, might be better than an online chat.

You also mentioned "new product." That too in unclear in meaning. Most products are new until sold.

I agree with inital responder, that local inquiry and legwork seems to be the only realistic way to go.

If u are a Mech / Prod / Industrial Engnr then pls refer to your subject Industrial Engg. RK Jain for simple understanding. Else, as previous comments were better hire a costing engineer. It's not fair to disclose costing practices. And as the question is vague you get even answers too.

Time to dine. Good Night.

Cost should be based on sales dept. estimated sales and at what quantities of material you are buying. You can not come up with a cost based on a 1000 pcs. then buy material for 100, you will lose all profits.

Tooling costs should be divided over quantity to be made in the tools life. If a tool is good for 100,000 parts and you will produce 50,000 tooling cost should be divided into 50,000.

Plastics and metal should be calculated by quantities you plan to purchase in unit of measure you buy with (sq ft, oz. lb. etc.)

Both fixed and variable overhead must be included along with packaging materials and any other expense you have.

Sit down with paper and pen and list all the steps from purchasing until unit is out of your factory (include shipping costs of raw materials and any customs fees or taxes)

This will give you a real cost to start with.

Thank you for your solution

its is good comment

Regards

Dinesh

India