The Benefits of Automated Sheet Metal quoting and How/ Why it works.

The Benefits are simple.

• Quote Response Time is Faster
• Quoting Costs are Reduced
• Quoting Volume Increases Significantly
• Pricing is more Consistent
• Human Error is Reduced

To understand the benefits, let’s first talk about How and Why of Automated Sheet Metal quoting. Automated quoting is based upon the information available within a 3D CAD model coupled with user-inputted, non-geometric information. It interrogates the model to pull out geometric data relevant to sheet metal manufacturing such as the number of bends, PEM hardware, material thickness, cut length, etc. This geometric data can then be inserted into user-defined formulas for each required operation and importantly, required operations can be automatically determined (assigned) if a certain type(s) of geometric data is present. The formula then pulls information from user inputs such as quantity and material type, and from tables such as material pricing.

The How or Spreadsheet Approach:

Sounds simple and if broken down into the steps that manufacturing a sheet metal part comprises, it is. You already have a list of operations that are inserted into a router to make up your manufacturing instruction set. Typically every part includes at least the following operations: Order Entry, Engineering, Blanking (Punch or Laser), Time Saving, Bending/ Forming, Quality, and Shipping. Often other operations such as Hardware, Welding, and/ or Finishing will also be needed. Each of these steps has a very predictable setup and run times, at least from a “simple” standpoint. The beauty is that simplicity can be further refined and integrated into increasingly advanced formulas. And as exceptions (gotchas!) are experienced in the quoting and order win processes, they can be captured in formulas so that they are never again the cause of misquoting.  

Let’s use forming/ bending as a specific example to show how we can go from simple to complex. For our purposes, we will use a part with six bends. We want to fabricate 10 parts (make quantity). Each bend requires a setup and then each bend has a run-time. Our shop uses a half-hour per setup, 30 seconds (.0833 hours) per bend run-time and a shop rate of $90 per hour. The simple formula for Piece Cost for the forming/ bending operation would be $=number of bends *((setup time * shoprate)/ make quantity + runtime *shoprate) or, using numbers, $31.50=6*((0.5*$90)/10+0.0833*$90). The geometric analysis automatically determines that there are 6 bends, the make quantity is user entered and the bend setup times/ run-times and shop rate come from pre-entered information stored in tables. So far this is basic and can be done in a spreadsheet although the estimator would have to insert the new information while the Automated Quoting does it for you. By the way, all good Automated Quoting allows overrides of predetermined values and should include the ability to see how that price was calculated.

The Advanced How or Software Enabled Approach:

This illustrates some of the Basic “How” of Automated Quoting. Let’s make it a little more complicated, the Advanced “How”. Setup pieces are often required – an extra cost that may not be included in the way you do quoting now but a real cost. So let’s add “2” setup pieces to every make quantity. Setup time stayes the same but run-time increases to cover the setup pieces. The formula adjusts to $=number of bends *((setup time * shoprate)/ (quantity) + ((quantity+setup pieces)/quantity)*(runtime *shoprate)) or $32.40=6*((0.5*$90)/10+((10+2)/10)*0.0833*$90). Still a spreadsheet calculation. However, let’s refine our setup pieces to dial in how our shop actually functions. If the number of bends is 0, use 0 setup pieces. If the number of bends is between 1 and 2, use 1 setup piece. If the number of bends is between 3 and 8, use 2 setup pieces. More than 8 bends, use 4 setup pieces. AND if welding is required, include 1 additional setup piece to those quantities. Include 1 additional setup piece to those quantities if secondary machining is required. You get the point – your shop manufacturing DNA can be incorporated into the formulas – automatically. And this is just for setup pieces.

How about making the formula more refined for bend types to make it more realistic in what is actually done in your shop? Use Automated Quoting to have only one bend setup for all 90 degree bends. Add 15 minutes to setup time and 15 seconds run-time for each non 90 degree bend. Identify hems and use standard 45 minute setups and 45 second run-times for closed hems and 60 minute setups and 60 second run-times for open hems. Perhaps a $120 per hour setup rate for hems is more correct as it takes your more experienced setup person. Do you want to add extra time for bending stainless? Easy to configure. Automated Quoting gives you the tools to spiral into the exact way your shop operates to capture the correct setup and run-times for all the variations of bending/ forming operations.

The Why is The Power of the Cloud:

This starts to give you a flavor of the power of Automated Quoting and “Why” it is so powerful and different than how quoting has been done in the past and even done today with the newer ERP systems. Without geometric analysis outputting specific geometric data for each part, the power of Automated Quoting is muted. And the methods shown above can be applied to all other operations in your shop with the result that a unique pricing engine can be developed that reflects your unique shop.

Obviously a pricing engine tuned to your shop is a benefit. How do the other benefits tie in? Many of the variables in quoting are now prepopulated in the pricing engine which makes them consistent part to part. As exceptions are discovered where the cost impact may not be known by an inexperienced estimator, they may be put in formulas so they do not reoccur. In other words, automated Quoting puts in place guard rails. This allows you to more confidently share estimating responsibilities with less experienced team members. It is hard to find experienced estimators. Now you have a way to bring junior team members up to speed while not worrying about productivity and costly misquotes.

Detailed Look at Benefits:

Speed is an obvious result of Automated Quoting. Scanning drawings and 3D data for dimensions, hole counts, bend counts, etc is now done by the software instantly! The faster a quote is returned, the higher the win rate. Don’t want to increase your win rate while quoting faster? Raise prices slightly – the extra margin is all profit!  

In addition, your quoting costs are reduced as it takes less time to quote each part. Your estimator (perhaps it is you?) does not enjoy activities such as moving files to directories, and opening and printing them. The time in quoting is now spent on value-add activities where the estimator’s experience can be put into playing tweaking numbers and/ or calling customers to review quotes (conversations increase win rates).  

Some other miscellaneous benefits of Automated Quoting in the cloud include a more professional digital look, being able to tell when and if someone actually looked at your quote, easily adding expedite options and being able to take orders digitally and by credit card. Finally, a not so miscellaneous but hard today to quantify benefit is the every day building of your shop’s history. The collective knowledge of your estimators is captured, making them smarter and down the road, making a buyer of the shop more comfortable that the history of the shop does not walk out the door with the owner or any one person. 

The Smart Phone Analogy:

Think about how you use a smartphone today. It automates many things that took a little to a lot of time previously, most things you couldn’t do on a flip phone. Which makes you more productive, responsive, and ultimately happier. Automated Quoting is the smartphone equivalent. Would you go back to a flip phone?