Future success with fast and precise offer calculations
Offer calculation represents a great challenge for many companies in the metal industry. Especially in an economic downturn new orders with competitive prices have to be won. If, however, the basis for a fast and precise calculation is missing, correct decisions are difficult. There is a danger that the profit margin and thus the company result will deteriorate. The reason for this is often the uncertainty regarding product-specific manufacturing costs due to high manufacturing complexity with alternative production routes as well as product-specific processing times.
In many companies, quotations are only calculated on comparable products which have been revalued in the past, which means that current price changes (energy, etc.) or efficiency enhancement programs (increased plant performance, etc.) are not reflected in the product costs. Sometimes, in addition to that procedure, a rudimentary Excel calculation solution with an outdated database is available. To make matters worse, many departments often work in a sequential process, which extends the time of calculating costs.
The quote calculation is about the highest possible cost transparency and speed, so that a competitive but also profitable price can be placed in the customer offer. The price quoted to the customer determines the future margin and together with the speed of offer process it is decisive for winning future customer orders.
An ERP system can support the process in such a way that the expected manufacturing costs for the desired product can be determined based on the latest data (e.g. actual energy costs) and documented expert know-how, by simply pushing a button. The approach here is “variant configuration”, which automatically determines the bill of material and work plan for cost evaluation based on the available product specifications.
“Variant configuration” provides particularly good quality if it is based on an intelligent and complete set of rules consisting of object dependencies and master data. The challenge in developing this set of rules is, that despite only roughly known product specifications and the high manufacturing complexity, the cost information must be precisely identified.
To ensure that the solution is based on a robust foundation, first, the components of the calculation and the set of rules must be clarified with great care. Afterwards it can be implemented in a system.