Reduce hidden tool costs to achieve savings in tool procurement

By Emilia Maier

How to significantly reduce tool costs? There is an increasing need for new tools in the automotive industry, such as newly required parts for the new mobility generation (CASE). Not only high quality and short delivery times are required, but competitive tool costs also help them to decide whether a product can be successfully positioned on the market.

Tool costs play an important role from the very first moment after receiving the customers’ inquiry. How is it planned and what kind of tool is required to manufacture the product? What does the tool concept look like? What other aspects need to be considered regarding the tool cost calculation to be successful?

But even if there is a potential to reduce tool costs, tool buyers must deal with quotes for tooling, which are often very high-level, detailing only material and labor costs. There is very little detail made available, and there are only a few cost standards to compare tool costs against. Since many tool suppliers do not have valid reference data, there is a lack of information for the buyer. The information the suppliers have often depended on a few individuals with specific tooling expertise. This prevents them from obtaining an accurate and valid tool cost calculation.

Attack costs, not supplier’s margins

The Teamcenter® software for Tool Costing helps tool buyers in these challenging tasks. Cost engineers on the buyer side can use Tool Costing to do shadow calculations as a plausibility check on the calculations of their suppliers. They can use Teamcenter information such as technical data, part descriptions, or 3D-data to create cost calculations using the parametric methodology. The results also support the tool supplier when it comes to improving productivity in their own value chains.

Tool buyers take advantage of Teamcenter Tool Costing with:

  • Improved understanding of cost drivers and their impact on tool costs
  • Improved knowledge management for all buyers and tool cost analysts
  • Assistance in cost structure negotiations and value engineering workshops with tool manufacturers and tool suppliers
  • Improved return on investment by calculating tool variants and changes

Cost engineers can also take advantage of the combination of Tool Costing and the Teamcenter software for Product Costing for a fully integrated calculation solution.

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This article first appeared on the Siemens Digital Industries Software blog at