3. PRIMARY INFORMATION
Company which needs castings, we will call as customers & the
company which produces the same, we will call as suppliers.
Now, when any customer is looking for castings to be produced,
obviously, will look for a better foundry. When customers
contact suppliers for their need for castings, they ask for
suppliers’ facility details, certification, etc & sometimes they
visit personally also. Supplier provide the required information
to the customers. If the supplier is satisfied by the facility &
system of supplier, he offer some drawings for the required
parts. Now, the question comes “how to work on this offer?”
What is the basis to calculate this offer for the customer? The offer
must be based on all the information mentioned in the drawings
& specifications provided by the customer. Supplier should
calculate all the costs which are connected to manufacture that
product.
4. Everything must be studied and understood by both
parties (the customer, and the supplier) for all
requirements for that product. In short, the supplier
recognizes and understands what the customer
wants, and confirms to meet these requirements
by his offer.
If this simple rule is not followed, very often problems
come up between the customer and the supplier after
starting the development of the part.
Many customers clearly mention the standard
specification to which the casting(s) should conform –
including material specification, testing methods,
delivery conditions etc, along with the drawings, and
their purchase conditions. If the supplier does not
clearly understand about any point in these, he must
seek clarification before submitting an offer.
5. SIMPLE STEPS TO FOLLOW:
The steps : Technical and commercial evaluation in the following sequence
will enable us to develop any new casting easily and systematically:
1. Standard (number & edition): Always use the latest edition of the
standard. Check the number of the standard. If it is an overseas
standard; find out its equivalent Indian standard, and its latest edition.
2. Material properties: The customer (or the component designer) must
indicate the material properties of the component: UTS, special tests if
required, e.g. pressure test (if yes, at what pressure?), impact test,
radiography, MPI, etc.
3. Representative section thickness of casting: Some cast alloys are
section sensitive, e.g. flake graphite cast iron. In the same casting, the
properties may vary at different locations, depending on the section
thickness. Hence test block section and test bar dimensions should be
decided in advance to represent the section thickness important in the
component.
4. Salvaging of the casting: If the casting if found with any discrepancy,
it is necessary to know whether it can be salvaged (by welding or filling
the cavities by m-seal) or not.
Specification
6. QUANTITY
Following information should be known before
submitting an offer (i.e. a quotation):
1. Normal Order Quantity (NOQ)
2. Annual Order Quantity (AOQ)
3. Future demand of that part
4. Test Pieces or test bars
Normal Order Quantity is required to evaluate the
supplier’s facility for the production – hand
moulding, automatic machine moulding etc.
According to the facility or the production
method of the supplier, he can inform the
customer to specify the optimal order quantity.
7. In serial production (>100 numbers), it is indicated in
most standards that the supplier can deliver with
variation up to ±5% of the order quantity.
Depending upon the normal order quantity or total
order quantity, number of sample castings can be
pre-decided, say 50, or 100 or any other number.
We can call these as a “Pilot” batch.
8. DRAWINGS
The customer can provide drawings of different types :
1. Machining drawing, using which the supplier has to make
pattern equipment after adding machining and other
allowances, and make castings. Machining drawing
includes surface finish conditions, area or location for
machining and amount of machining. Dimensional
tolerances are indicated as per need or as per the standard
for casting tolerances or machined component tolerances
standards.
2. Sometimes they may give casting drawing, along with
machining drawing. After making the casting, the supplier
can check the casting with respect to machining allowances
and other requirements.
3. At times semi-finished part drawing is provided, in case the
part needs to be tested by non-destructive tests like MPI,
Radiography etc. Tolerances are indicated in these
drawings also.
9. IMPORTANT POINTS ABOUT DRAWINGS
The drawing must indicate the Condition of the part
viz. machined condition, semi-finished condition or
“As-cast” condition. This should be clearly mentioned
in the title block of the drawing. Machining tolerances
should be mentioned if it is a machining drawing.
Version of the drawing with the date of revision and
by whom it was revised: If any modification is done in
the drawing, it is very essential for the customer to
make a new drawing and provide to the supplier, and
to withdraw the old drawing. The supplier should
acknowledge to the customer the receipt of the new
drawing, and should start working as per the new
drawing.
10. Tolerances: There may be three types of tolerances: 1.
tolerance for individual dimension, 2. Geometrical
tolerances, or 3. General tolerance table.
If general tolerance is applied, it must be indicated
particular tolerance for particular dimension; e.g. for
diameter, for thickness, for length, for radius at
particular spot etc. That means, all dimensions must be
clear for tolerances. The tolerances must be as such to
get a good part after final machining. The tolerances are
clearly set for “as-cast” parts standards.
Surface roughness is disputable parameter for all
casting manufacturers and customers. It is less
important at the areas of the component where
machining is done. It depends on the method of casting,
type of moulding material and complexity of the casting.
11. The roughness of the casting surface depends upon:
I. Moulding material and its flow ability
II. Fluidity of the casting alloy
III. Number of risers, chills, locations of chills, coating
material for cores & moulds etc.
IV. Complexity of the part. Uneven metal thickness can
create problems. Metal cannot solidify at equal rate,
creating problem for choosing the right pouring
temperature. High pouring temperatures can also create
problem for roughness of the casting.
Machining stock must be such that the supplier can
produce that part. Required dimensions must be obtained
within the tolerances and with the plain surface roughness
as required. This machining stock (allowance) should be as
less as possible to keep the casting as well as the machined
part cost low.
12. PATTERN EQUIPMENT
The supplier can decide the pattern equipment
material & number of patterns / core boxes
depending upon the complexity of the part, order
quantity per year or life long, and moulding method
decided for that particular part (green sand – hand
moulded, machine moulded, no-bake moulded, shell
moulded etc).
To illustrate this point for different types of
components, some moulding & pattern details are
given as the points below:
13. 1. Large quantity order, complex, small size part, high tolerance
& surface finish requirements – Shell moulding / core making
or Investment casting is preferred.
2. Large quantity order, small & big parts, requiring medium
tolerance & roughness values – metallic and/or plastic/araldite
patterns are preferred (for green sand machine moulding).
3. Medium order quantity, small & big parts with medium
tolerance requirements – Hard wooden or plastic patterns are
preferred in usually chemically bonded sands, but in case of
small & simple parts, wooden patterns can work in green sand,
automatic moulding machine also.
4. Small order quantity, for small or big parts, sometimes wooden
pattern may work, but for big parts > 100 kgs, as normally
chemically bonded sand is required, wooden pattern can not
work. Here, metallic pattern is required though the order
quantity is less.
5. Finally, for one time production, there are different ways of
production:
The part itself works as a pattern by just covering it by
additional allowances by wooden pads or metallic padding to
make it to work as a pattern.
14. For Cylindrical & simple castings, Sweep pattern can
be used in pit moulding by loam sand. Also, thermocol
pattern is preferred.
15. QUALITY CONTTROL & INSPECTION
Quality level is indicated by various types of tests &
inspection procedures. Such tests are:
Visual & Dimensional Inspection,
Mechanical Properties Tests,
Chemical Composition Test, and
Non-destructive Tests
Visual & Dimensional Inspection :
Inspection can be carried out by the supplier, the
customer, or a third party. It is necessary that the
casting must meet the standard set in the purchase
order and which has been accepted by the supplier.
Inspection is carried out as per the standard, e.g. in
Europe, this standard is EN 10204 3.1 / 3.2. The
surface quality is checked by Visual Inspection, and the
fitness of the part is checked by dimensional inspection
according to the drawing.
16. Surface quality is also checked by some non-
destructive tests like :
1. Magnetic Particle Testing (MPT),
2. Dye Penetrant Testing (DPT) or Liquid Penetrant
Testing (LPT), or
3. Surface Roughness Test (especially carried out on
the finished machined part).
Mechanical Properties Tests: Such tests include :
1. Hardness test (Brinell, Rockwell or Vickers scales)
2. Tensile test (UTS, yield strength, ductility)
3. Impact Strength test (at specified temperature)
4. Bending test
5. Shock Resistance test
6. Pressure test etc.
17. Chemical CompositionTests: Two methods of chemical
composition tests are : Wet analysis (traditional method),
and Spectrometer analysis.
Non-Destructive Testing (NDT): Section quality (i.e.
soundness) can be checked by different tests :
1. Radiography Test (RT)
2. Ultrasonic Test (UT)
3. Eddy Current Test
Microstructure Evaluation : Microstructure or other
property may differ at different locations in the same
component. Customer can put some restrictions for the
microstructure variation from section to section.
In the same way, customer can specify location for the test
also. For example, they can specify particular location for
hardness test, or radiography test or MPI.
18. PILOT BATCH PRODUCTION
Pilot batch is normally used to carry out inspection at
the customer’s end for various purposes, viz.
Supply consistency
Quality of the material
Dimensional accuracy & consistency
Surface quality
If everything is fine, and if the customer wants large
quantity, he can decide the pattern material, i.e. go
for metallic patterns or continue with wooden
patterns etc..
19. DELIVERY CONDITIONS
After production of the pilot batch, the question comes for the
delivery conditions. The customer should specify the
conditions for delivery of the parts at the time of placing the
order. Delivery condition of the parts, depends upon the
condition of the parts – as-cast or fully machined & finished.
Overseas customers indicate their own requirements for the
parts to be supplied.
At the same time, the mode of transport is also decided before
ordering, so that the supplier and the customer both can
assure timely and safe delivery of the material.
It is also a must for the customer to specify the condition of the
part to be supplied (as-cast, semi finished, fully machined,
painted, oiled or greased, or just as-cast or as-processed
condition). This is necessary for the safe delivery of the
material. Because, if the customer needs the parts in as-cast
condition, either the parts can be sent naked, painted, primer
applied, or oiled by rust preventive oil.
If the parts are to be supplied in semi-finished or machined
condition, they should be oiled by rust preventive oil and
packed in either plastic bags (for small parts) or covered with
plastic and fixed in pallets to eliminate damage during
transportation (especially for big parts).
20. DELIVERY SCHEDULE
Delivery schedule is decided by the customer and the
supplier at the time of finalizing the order. Many
customers provide the annual order, & then send the
monthly requirements as schedules by 1st week of
every month or in the last week of the month for the
coming month. It is likely that the customer may ask
for the fastest possible delivery, and the supplier
may prefer little longer time for the delivery. But the
important thing is that both – the supplier and the
customer – must finalize the time for :
First Sample
Pilot Batch
First supply of mass production
21. For this, after finalizing the time schedule the supplier
should prepare a time plan for the above actions.
After presenting the time plan to the customer, the
supplier must stick to it. Too short a delivery time
increases the risk of rejection, cost to
supplier/manufacturer, and needs highly skilled staff,
highly sophisticated machinery & instruments,
automatic production capacity etc. at the supplier’s
end. On the other hand, too long delivery schedule
can increase the risk of loss of credit or order for the
supplier. Also, it increases the risk for the customer
to lose his market orders from his customers.
22. Just in Time (JIT) delivery concept is desirable for
optimum results.
For new part development, longer time is needed.
Because, first time production of any part needs
attention on methoding, pattern equipment making
and other process details. Also there may be some
change or modification in pattern, production method
or methoding of the casting for mass production.
Hence, it is preferred to set the delivery time for mass
production only after obtaining the acceptance from
the customer for the pilot- batch.
23. COST ESTIMATION
Price is decided jointly by both the parties – the
customer and the supplier – on the basis of order
quantity, complexity of the part, weight of the casting
(or cast component), production method, required
quality standards & testing, rejection level, supply
condition (painted, oiled, machined, semi finished),
packing & delivery standards, transportation, duties
& taxes applied, and at last the profit margin.
In other words, “Price is the best reward for
the component supplied to the customer,
as desired by the customer, in
accordance to assuring full satisfaction
to the customer (or the end user).”
24. COSTING TABLE
Data to be collected for costing
Pig Iron
Carbon cup for
CE analysis
Furnace Lining
MS Scrap Burning Loss Refractory material
Returns Yield Whyte Castable
CI Scrap Asbestos
CRC River sand Plant Maintenance
CPC Returned sand Electricity
RPC Bentonite Labor Cost
Graphite Electrode Scrap
(GES)
Coal dust
Charcoal Dextrin In-house Rejection %
FeSi River sand Profit Margin
FeMn No-bake Part-A
FeCr (High Carbon) No-bake Part-B Overheads
FeSiMg Alloy Shots
Inoculation Electricity
Copper Grinding Wheel
25. The foundry should calculate the price on the basis of-
the above mentioned points, and add to that - other
business related expenses, outsourcing cost (if any),
plant maintenance and depreciation cost, other
overheads etc.
The price is finalized on the basis of “per part” or “per
unit of weight”. Also, the supplier should mention the
condition in the agreement about the currency
conversion rates, especially while dealing with
overseas customers. If there is any change in
currency conversion (e.g. US Dollars or any other
currency to Indian Rupee or currency of the supplier’s
country) about 3% (or as pre-decided by both) of
variation is accepted, otherwise the customer has to
bear the difference.
26. Tooling (i.e. pattern equipment) cost is calculated extra
and intimated to the customer in most of the cases,
as the supplier is normally not ready to bear the cost
of the pattern equipment. The supplier should also
request the customer to validate the pattern
equipment while confirming the pilot batch quality.
Cost Calculation needs much attention because there
are many factors in a foundry to be considered. Even
the hand gloves used, materials like Feviquik, nails,
screws nuts & bolts also should be considered for a
perfect costing. But, normally, in almost 95%
foundries, it is neglected. It is normally covered
under Overhead costs.
27. P A Y M E N T
This is a very interesting & the main part of our evaluation.
Most of the customers wish a longer credit period, & most
suppliers wish to have a short time payment period.
Hence it is decided by both the parties at the first meeting
before finalizing the order. Mostly pattern costs are
released by the customer to the supplier in advance n
order to develop the parts. Sometimes, some amount of
money is kept as a security deposit, by the supplier,
especially in the case of International dealing.
Payment for the supplied parts is made :
on correct quality & quantity delivery of the parts as per
the Purchase Order raised by the customer,
on receipt of related documents like invoices, test
certificates, inspection reports etc., and
according to the agreement made at the time of finalizing
the order,
as per the payment time agreed to jointly by both parties.
28. INVENTORY FOR THE FINISHED PARTS
Many times, it is agreed by the supplier and the
customer, that some quantity of parts is kept as
inventory by the supplier for Just in Time (JIT)
delivery of the part, upon receipt of the schedule from
the customer. Because, customer normally issue a
common order for the whole year or for six months,
and then they provide schedules as per their
requirements or on monthly basis.
In this case, the supplier can request the customer for
the inventory cost, because every supplier cannot
afford this cost. Also, at the other end, the customer
should offer this cost to the supplier. In this way, a
strong bond and good understanding is formed
between the customer and the supplier. Such
relations can be long lasting.
29. There are certain advantages and disadvantages of the
inventory of the parts. Advantages to the customer are:
No transportation cost
No damage of the parts
Pattern maintenance responsibility is with the supplier
No storage tensions at customer’s own premises
Can get on time delivery of the parts whenever a schedule
is raised to the supplier.
Advantages to the supplier are:
Can assure timely delivery of the parts to the customer,
keeping his prestige for timely delivery,
On the basis of existing stock lying with him, he can create
get more financial support from banks.
But there are certain disadvantages also for both the
supplier and the customer. The customer has to give
assurance for the patterns from any damage. On the other
hand, the supplier has to bear the cost for inventory, and
the responsibility for the ready components and the
pattern equipment.
30. &….At the ending of this session, I would like to
tell my friends, that…
Careful technical and commercial
evaluation – done jointly by both
the customer and the supplier – will
go a long way towards happy and
healthy business relationship and
continued growth of the castings
business.
HAPPY CASTING..!!!!!!
