GlossaryKind of term: Manufacturing termCost engineer
What does a cost engineer do?
The cost engineer works out what a part costs for each request, from material, times, subcontracting and rates, as the basis for the price.
In concrete terms the cost engineer defines the material and stock, estimates setup, programming and machining time per setup, adds subcontracted operations and any special tooling, and applies the machines' hourly rates; the outcome is the cost price. The selling price per quantity follows within the company's margin policy. In smaller shops the manufacturing engineer or the owner does this work; in larger ones it is a role of its own.
How does a cost engineer work in practice?
An estimate has to be quick enough to answer requests and consistent enough to give similar parts a similar price. Too high can lose orders, too low can lose margin. Consistency rests on shared assumptions: the same hourly rates, the same conventions for setup time, mark-ups and one-off costs, and inputs that are visible for every item. If the method lives in one head or one spreadsheet, it is hard to hand over or trace. Post-calculation on actual hours shows where the assumptions are off.
What is a cost engineer often confused with?
A cost engineer is not a manufacturing engineer: the cost engineer prices the part, the manufacturing engineer decides how it is made; in many shops the same person does both. Nor is the cost engineer in technical sales: sales owns the customer relationship and negotiates, the cost engineer supplies the reasoning behind the number.
How does a cost engineer work with Blake?
An estimate in Blake is built from separate lines by cost type, with piece and batch amounts, quantity breaks and each machine's own hourly rate. A correction to the calculation needs a reason, and who made it and when stays visible. The figure is marked as an estimate. More on estimating.
Frequently asked questions
What does a cost engineer do in a machine shop?
For each request they work out the cost of the part: choosing the material, estimating the times, adding subcontracting and any special tooling, and applying the machine rates, per quantity. The company bases its quote on that, written by the cost engineer or by sales.
How do you stop two cost engineers producing two prices?
Use one method for everyone: the same hourly rates, the same conventions for setup time and mark-up, and the inputs visible for every item. A difference can then be traced to a single line.
What is a calculator in a Dutch machine shop?
The Dutch name for the cost engineer: the person who prices parts from the drawing. Dutch shops call the estimate itself a calculatie, and the estimate made before the order a voorcalculatie.