Managing the Cost & Lead Time of Your Gasket Material

We’re sure you all have made resolutions to find cost savings and be on top of materials procurement this year. In order to help keep you on track, we thought we’d kick off 2017 with a look back at 3 of our more popular cost and lead time blogs. Now you can read them all in one place and always have them at your fingertips!

How Much Should Gasket Material Cost?

“What is Your Lead Time?” 4 Ways to Get a Better Answer From Your Supplier.

4 Ways to Try to Reduce the Price of Your Gasket Material

Go forth and find those cost savings and procure your gasket material like a rock star!

Happy 2017!

Managing the Cost & Lead Time of Your Gasket Material

4 Ways to Try to Reduce the Price of Your Gasket Material

Everyone loves saving money…us included. It becomes even more important when you’re in an industry where there are tiers of suppliers and price is scrutinized at every level. Finding a way to reduce costs will keep you competitive and a part of someone’s supply chain.

In most applications, the gasket tends to be less of a cost driver than other parts, but it doesn’t get any less scrutiny. Everything adds up when you’re trying to stay competitive and it doesn’t matter how big or small your piece of the puzzle is. We get calls all the time from our customers asking how they can save money. Continue reading to to see how you can try to reduce the price of your gasket material.

Reducing The Price

1. Are there price breaks or volume discounts

Ask if your supplier sells their material in a tiered system. If you’ve always bought the exact quantity of gasket material needed, maybe you’re paying more per sheet or coil than you should be. If you can move into a higher tier, you’ll sometimes get a much better price. The savings can then be passed along to your customers.

2. Figure out how to use more of the material

Now that you are buying more material to get that price break, you have two options. One is that you just enjoy the freedom of not buying as many times throughout the year. The other option, and how you’ll use more material, is to shop the gasket material around for other applications. You might just shoot your usage through the roof, and then possibly get an even better discount!

3. Is there a less expensive material that will work

Unless a particular material is on the specification, there may be an alternate material that will still meet your requirements. This may drive some additional testing to qualify it, but in the long run, if there is an economy version or a similar material at a lower price point that works, you’re going to have one happy customer.

4. Ask what else can be done about the price

As a gasket materials supplier, we look for every opportunity to pass along savings to our customers. If you have a particular material that is a pain point for a particular customer, talk to your supplier. If we are aware of the issue, we can look for opportunities to do something about it. Every once in awhile, we can work with our suppliers to explore volume and pricing issues that may help you in the long run. You don’t know if you don’t ask.

The Bottom Line

Price can be a difficult issue to work through. By fostering a strong relationship with your suppliers, you’ll be able to have these conversations. A good supplier recognizes when they have a strong relationship with their customer, and does everything they can to make the partnership as successful as possible. Sometimes a straight price reduction isn’t possible, but there are ways to purchase a gasket material that meets your requirements at a better price than what you are currently paying.

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Metal Tech has passed savings along to customers twice this year – one with the restructuring of a coil discount that helps more of our customers save money, and the other was a price decrease that we were able to make after working with one of our suppliers to reduce costs. We are always working for you!

How Much Should Gasket Material Cost?

Raise your hand if you are guilty….is one of the top 5 questions you ask your gasket material supplier “How much does it cost”? Look at all of those hands! If yours is up, refer back to last week’s post 5 Questions You Should Ask Your Supplier of Gasket Material.

In all seriousness, cost of material is a valid question. Cost is one of the most difficult aspects to deal with in life, let alone when you are going to be spending someone else’s money. How should you deal with cost when you’ve been placed on a shoestring budget and need to get approval before you can go too far forward with your project? The answer is (drumroll, please)…..Value.

Breaking It Down

Let’s break it down. You are working on an application and have a requirement for your gasket. You call up your gasket material supplier and tell them your requirements, and they list one or two materials that fit those requirements. What should your next question be? If you said “price” or “cost” you may be approaching this conversation the wrong way. Now, if you’re asking for a frame of reference, that’s one thing. If you’re asking and may potentially hang up the phone if you don’t like the answer, we beg you to keep reading.

Believe it or not, suppliers are not out to charge you as much money as they can get away with. There is a cost to purchasing raw materials and a cost associated with production of the product. (We will keep freight out of this conversation because freight is, well, freight.) We’re also going to put this out there…most businesses are in business to make money, and everyone has margins they are trying to achieve. The idea is to price things to sell and make a small profit. So….what cost tends to really boil down to in some manufacturing operations is the cost of raw materials.

How To Determine Value

Back to our question of value. How does one determine value? Well, first, you need to look at yourself (by that, we mean look at the application that you need a gasket for). What are your sealability requirements? Is there a corrosive environment? What kind of service life do you need? Special requirements tend to drive the need for premium products, which tend to drive up costs. If your applications require premium products, you should prepare to pay a premium price. Believe us, as suppliers, we are always looking for ways to try to lower your cost, but sometimes our hands are tied.

The second way to determine value is to run a test and look at the results. If a material meets your requirements and tests exactly like you want it to, why would you give up performance for price (especially if the alternate material does not perform)? Everyone involved in the decision making process needs to consider the lifetime of the application….

How much does downtime cost?

Think of how much money may be lost if your application isn’t running like planned.

What would a high service call rate (SCR) do to your application?

Don’t forget, it isn’t as easy as changing out the gasket. There might be thousands of dollars tied up in a repair – all because of a bad gasket.

What is the total cost of production for the gasket?

Material isn’t the only factor that goes into price (tooling, cutting, quantity, quality, etc.). A material that costs more up front may end up costing less when you factor in all of the additional costs for an alternate material.

What is the cost of poor quality?

If any of our loyal readers are ISO/TS 16949 certified, these words are near and dear to your heart. The evaluation of the cost of poor quality can be an eye opening metric. Quality (or lack thereof) can play a huge role in value. Taking into consideration whether or not your material supplier has a certified quality management system should definitely be at the top of your list when determining value.

Make a Proposal

There is a lot to take into account when you are trying to determine value. If you are adequately able to do so, the sticker shock can most times be eliminated. Information is key to making decisions, and you want to collect all of your information before making a proposal on a material. Don’t let cost drive you in your research. Most times, you get what you pay for. Value is King!

So, back to the initial question – “How Much Should Gasket Material Cost?” – unfortunately the answer is “it depends”. You’ll need to price out your specific needs with your supplier, but please remember to keep value in mind throughout your discussion.

How often do you consider value?

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