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Cost Savings with New CNC Machine

The document analyzes the labor cost savings of acquiring a new CNC machine for Haniff Machine. It shows that the CNC machine would save $80,640 per year in labor costs compared to existing drill and lathe machines. Over 20 years, the total savings would be $1,415,000 after accounting for the $305,000 cost of the new CNC machine. While the CNC machine represents a good investment due to the 40% reduction in labor costs, other factors like maintenance costs and staff training would also need to be considered. Standardizing equipment from a supplier like Mazak could simplify processes but an analysis of other suppliers should be done if lower prices are available while still maintaining quality.

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hector bravo huerta
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423 views5 pages

Cost Savings with New CNC Machine

The document analyzes the labor cost savings of acquiring a new CNC machine for Haniff Machine. It shows that the CNC machine would save $80,640 per year in labor costs compared to existing drill and lathe machines. Over 20 years, the total savings would be $1,415,000 after accounting for the $305,000 cost of the new CNC machine. While the CNC machine represents a good investment due to the 40% reduction in labor costs, other factors like maintenance costs and staff training would also need to be considered. Standardizing equipment from a supplier like Mazak could simplify processes but an analysis of other suppliers should be done if lower prices are available while still maintaining quality.

Uploaded by

hector bravo huerta
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd
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Assignment No.

3
Haniff Machine
Héctor Ernesto Bravo Huerta
Student ID: 101342582
PAYROLL   SAVING PER MONTH   SAVING PER YEAR

Drill and Lathe Hours saving $ 20.00 Saving per month 6.72*12

Employees per Hr $ 25.00 Hours per shift 8 TOTAL 80.640

Employees per Hr $ 25.00 Day s per Month 21

TOTAL $ 50.00 TOTAL 6.720

CNC per Hr $ 30.00 SAVING IN THE NEXT 20 YEARS

TOTAL $ 30.00 New Machine $ 305,000.00

CNC $ 1,720,000.00

SAVING $ 20.00 TOTAL $ 1,415,000.00

CNC per Month  

30*40 $ 1,200.00

1200*2 $ 2,400.00

Saving 40%
What labor cost savings are available through the
acquisition of the new CNC machine? Is this a good
investment?

 We can be seen how the savings by now buying


the machinery reduces the costs generated by the
staff for doing their daily activities.

It is one of the best investments that the company


can have since with this they reduce 40% of its
cost, saving a very good part of the business.
As Haley Gregson, what other factors would you
include in your analysis? What information do you
need and where would you get it?
 Other considerations to take is:
Cost of parts Maintenance and training and
training of staff for the correct use of
machinery.

The process is safer than the previous


manufacturing process can be standardized,
cost of services such as light, our production
percentage can be optimized.
What are the benefits to Haniff by standardizing to equipment
manufactured by Mazak? Would you be prepared to use another
supplier if the price of the equipment was lower?
 With a machine like the one that was bought, the
product standardization process should be easier
since the staff can be trained to be able to have a
constant product, the benefit is for our clients and to
be able to give a quality product in all our products
and thus also be able to reduce costs in raw
materials.

If the supplier can give us the same quality with lower


costs, it would be advisable to make a tender for our
suppliers to find out which one is best for us, since
the lowest price is not always the correct option.

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