Costing in Metal Additive Manufacturing - 1 — Lesson 2

This lesson covers the concept of costing in metal additive manufacturing. It delves into the different aspects of costing, including direct and indirect costs, machine costs, labor costs, and other components of cost. The lesson also discusses the importance of well-structured costs and the impact of ill-structured costs on the overall cost structure. It further explains the concept of activity-based costing (ABC) and how it is used in estimating the cost of additive manufacturing. The lesson also highlights the advantages of additive manufacturing in terms of cost-effectiveness and efficiency. For instance, it explains how additive manufacturing can reduce inventory costs by making parts on demand and eliminate transportation costs by manufacturing the whole assembly at a single location.

Video Highlights

00:17 - Explanation of how cost is controlled in metal additive manufacturing and comparison with conventional manufacturing methods
07:20 - Discussion on the concept of waste identification in cost structure
14:03 - Explanation of the cost structure in additive manufacturing, including direct and indirect costs
27:01 - Discussion on the cost ladder in additive manufacturing, including direct cost, factory expenses, administrative expenses, and selling and distribution expenses
34:43 - Explanation of the cost model in additive manufacturing from different perspectives, including finance and accounting, manufacturing, and management

Key Takeaways

- Costing in metal additive manufacturing involves direct and indirect costs, machine costs, labor costs, and other components of cost.
- Well-structured costs are crucial for controlling the overall cost structure, while ill-structured costs can lead to sporadic distribution and undefined costs.
- Activity-based costing (ABC) is a common method used in estimating the cost of additive manufacturing. It considers a wide variety of elements that impact resource usage.
- Additive manufacturing can reduce inventory costs by making parts on demand and eliminate transportation costs by manufacturing the whole assembly at a single location.
- The cost structure in additive manufacturing is key in determining whether series production is cost-effective.