Seco is one of the world’s largest providers of comprehensive metal cutting solutions for milling, stationary tools, holemaking and tooling systems. For over 80 years, we have been more than just a cutting tool provider. We develop and supply the technologies, processes and supports that manufacturers depend on to maximize productivity and profitability.
Throughout history, manufacturers have sought ways to make their machining processes more efficient and cost-effective. Those efforts involve ongoing development of advanced and precise production machinery, improved cutting tools and optimization of cutting systems overall.
The recent initiative called smart and sustainable machining aims at reducing raw material consumption, energy use and generation of waste throughout the product life cycle to a level that at least is in balance with the carrying capacity of our planet. Oftentimes, general discussion of sustainability concentrates on large global environmental issues but overlooks the basic elements of price, cost, customer satisfaction, process knowledge and reliability. When it comes to sustainability in machining, true success starts with simple, straightforward steps and analysis.
Sustainable Pricing
Every business faces the challenge of setting sustainable prices for its goods or services. The price must be high enough to cover costs and produce a profit, but low enough that it doesn’t drive customers to competitors. A manufacturer can set a higher price if the customer perceives that the product provides sufficient value for what is paid.
On the other hand, if pressure from customers and competitors results in setting the price too low, profit margins suffer. When the price is below the cost of producing the product, losses result. If competitive pressures push the price too low, those designing and machining the product have to find ways to produce it cheaper, faster and better to cut production costs and support a sustainable profit margin.
Invisible Costs
However, in many businesses the point where costs stop and profits start is unclear. That is because the real costs themselves also are unclear. Hidden, ignored or unknown factors are not part of the cost calculation. Typical invisible costs include unplanned downtime, rejected workpieces and broken tools. These costs are not considered representative or “real.” The attitude or mindset that results in some cost factors becoming invisible is not limited to production staff; it can exist company wide.
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