The Lowest Price does not always deliver the lowest cost

Problem:

In this cast Iron Machining facility, in order to control rust and deliver the tool life the facility was looking for, their coolant had to be maintained at a minimum concentration of 10%. Though the price per gallon was very attractive, the high concentration required significant volumes of top up to maintain the system within target.

Objective:

Focusing on their toughest and most sensitive machining operation and using Zimmark’s ICE Process (Independent Coolant Evaluations) to determine if there is a more cost effective product available.

Current State:
o Product Landed $/Gallon: $12.50
o Target Concentration: 10%
o Initial Charge Volume: 25 Gallons
o Expected Sump Life: 1 Year
o Monthly Consumption: 90 Gallons
o Annual Coolant Cost: $13,826

Investigation:
Using Zimmark’s Independent Coolant Evaluation service (ICE), multiple products were analyzed in Zimmark’s lab by stressing them with the facility’s fluid contaminates such as oils, lubes, bio & chips, to determine which product showed optimum performance in:
- Corrosion Resistance
- Bio resistance
- Oil Rejection Performance
- Carry Out Performance
- Foaming Resistance

By determining target concentrations for each product, evaluating expected change-out frequencies and carry-out rates, a projected costing model using quote $/G pricing was generated for each coolant. Balancing the most favorable performance with the lowest total cost (including any change-out costs) a new product was recommended and moved to the field trial stage of the evaluation.

Results
Coolant Reduction Chart

Warning!!
Fluid condition is very dynamic and if cost minimization is the goal, the fluid performance KPI’s need to be managed and maintained over time. The danger with purchasing a more expensive product, is that if your fluid use process is not being well managed, you run the risk of wasting a more expensive coolant which in turn leads to greater waste and no savings at all. Robust process controls that manage, monitor and adjust coolant condition over time is the best way to ensure that you are getting the full savings available from a better value product.

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