Finding a happy medium for pricing castings.

I read with particular relish the editorial, "Do We Produce Castings or $$$$?," in the January 2006 issue of Modern Casting. Having been associated with the metalcasting industry for more than 52 years, I can recall the "good old days" when all we were concerned with was "how many tons did we get to the dock today?" Never mind how much those castings cost, because we measured everything in "man hours per ton." Later, I realized we didn't have an easy way to look at individual part costs without the computer and proper software.

Fresh out of the army in 1953 and full of vim and vigor, I went to work for the old Indiana Steel Products Co. in Valparaiso, Ind. It took me several years to realize that the cost accounting principles I learned in college didn't work that easily in a metalcasting facility environment.

So, I joined the "man hours per ton" group for a few years. However, I realized that didn't work either. There are so many more aspects of individual casting cost than just labor.

When I worked for Grinnell out of Providence, R.I., I learned that the two viewpoints could be merged, i.e., the Mr. Geneen accounting and budgeting principles and the metalcasting obsession with cost per ton.

At B & L, we created a hybrid cost system that uses both ideas, and we like to feel that the clients who use our cost module are thriving businesses.

I don't want to send the message that B & L's cost system is the panacea for all companies to follow. However, metalcasting facilities today that do not have some method to quickly identify their "winners and losers" will soon be in trouble.

DICK LANEY

B & L INFORMATION SYSTEMS

BRIDGMAN, MICH.