Estimation of Welding

Cost

By
K.R.Prasanna Venkatesan
WE0663
 Sayings

“If you cant measure it, you

cant manage it”
– Peter Drucker.

“Ifyou are not measuring it

you are not managing it” -
corollary
 Types of Companies

Large Scale.
Design first, Cost Next.
Small Scale.
Cost First, Design Next.
 Estimating
 It is the process of determining the probable
cost of a Product / Process (Welding) before
the manufacturing.

 Estimation is the Process done by a

Technical Person and not by Accountant.

 Both Over Estimation and Under Estimation

is Dangerous.
 Costs
 Direct Cost.
 MaterialCost.
 Labour Cost.
 Expenses.
 Indirect Cost.
 Over heads.
 Admin. Expense.
 Selling and Distribution.
 Profit, Discount….
 Ladder of Cost.

Discount

Profit Market
Selling
Price
Sales and Price
Distribution Total
Or
Admin. Prodn. Ultimate
Cost
cost

Factory Work
Cost
Direct
Expense,
Material, Prime
Labour Cost Cost
 Material Cost
 It is the cost of Materials required for a
Process (Welding)
 Example:
 Direct: Filler, Flux, Gas, etc.
 Indirect: Cotton wastes, Coolant, etc.
 Labour Cost
 It is the cost spent to the workers who are
directly or indirectly involved in
Manufacturing.
 Examples:
 Direct: Operators, Welders…
 Indirect: Watchman, Supervisor…
 Expenses
 All other expenditure other than Material
and Labour cost is called Expenses.
 Examples:
 Direct: Power consumption, Welding M/C.
cost….
 Indirect or overhead cost: Depreciation.
 Welding Cost Parameters
 Joint Design Type
 Weld Size
 Weld Type
 Welding Process
 Electrode Deposition Efficiency
 Others (Safety)
 Thinking of Welders

“If a little is Good, a lot size

is Better, and too big is Just
Right.”

 But this leads to failure of Weld, and increase in

cost, which is not preferred.
 Butt Weld

Fillet Weld
 Factors of Welding Cost

•Time for joint preparation.

•Time to prepare the material for welding (blasting,
removal of oils, etc.).
•Time for assembly.
•Time to preheat the joint (when required).
•Time for tack-up.
•Time for positioning.
•Time for welding.
•Time to remove slag (when applicable).
•Time to remove spatter.
•Time for inspection.
 Factors of Welding Cost
•Time for changing electrodes.
•Time to move the welder from one location to
another.
•Time to change welding machine settings.
•Time spent by personnel for personal purposes.
•Time to repair or re-work defective welds.
•Costs associated with any required stress relief.
•Cost of electrodes.
•Cost of shielding materials.
•Cost of electric power.
•Cost of fuel gas for pre-heat (when required).
 Basic Cost Formula
Welding Costs = (L&O) + (Consumables
Costs)

The Operating Factor

 The ratio of hours spent welding to
total hours worked is called the
operating factor.
 Gas Welding & Cutting Cost
 Direct Material cost = base material cost
+ Consumable’s Cost (Filler, O2 & C2H2)
 Direct Labour cost = Preparation or pre
welding cost + welding cost + Post welding
cost.
 Direct expense = Cost of fixture and
auxiliaries.
 Over heads.
 Three Basic Approaches

 Cost per unit.

 Cost per length.
 Cost per weight.

The application will determine which

approach is most appropriate.
 Cost Per Unit
 This method suits for pieces that move
through a workstation.

 For SMAW
 Cost/unit = (L&O/unit) + (filler metal and
shielding material cost/unit)
 L&O/unit = (welding-related time/unit) x
(L&O rate)
 Cost Per Unit - Contd.

 For Wire Fed processes:

 Filler metal cost/unit = (wire feed speed) x (welding time) x
(weight of electrode/mm) x (electrode cost/kg)

 Filler metal cost (SMAW) = [{(electrode melt off rate) x

(welding time) x (weight of electrode/mm)}/(% of electrode
used)]

 Shielding gas cost/piece = (flow rate) x (welding time) x (gas

cost/m 3 )

 SAW flux cost/piece = (wt. of flux used) x (cost of flux/kg.)

 Cost Per Length
 This method is appropriate for estimating the
cost of long welds
 Formula:
 Cost/length = (L&O cost/length) + (filler metal and shielding
cost/length)

 L&O cost/length = (L&O rate)/(travel speed) x (operating

factor)

 Filler metal cost/length (wire fed processes) = {(wire feed

speed) x (wt. of electrode/(m or mm).) x (cost of
electrode/Kg.)}/(travel speed)
 Cost Per Length - Contd.
 Filler metal cost/length (SMAW) = (melt off rate) x
(wt. of electrode/length) x (cost of
electrode/Kg.)/(travel speed)(% of electrode used)

 Shielding gas cost/length = (gas flow rate) x (gas

cost/m3 )/(travel speed)

 Shielding cost/length (flux) = (wt. of weld

metal/length) x (ratio of flux to weld metal) x (cost of
flux/Kg.)
 Cost per weight

 Itis best used in applications in which

significant volumes of weld metal
must be deposited, such as multi
pass applications. Hard facing and
overlay welding are ideal applications.
 Formula
 Cost/Kg. = (L&O cost/Kg.) + (filler metal and shielding
cost/Kg.)

 L&O Cost/Kg. = (L&O rate)/{(deposition rate) x (operating

factor)}

 Filler metal cost/Kg. (any process) = (cost of filler

metal/Kg.)/(electrode efficiency)

 Shielding cost/Kg. (gas) = (shielding gas flow rate) x (cost

of shielding gas/m3 ) /(deposition rate)

 Shielding cost/Kg. (flux) = (cost of flux/Kg.) x (ratio of flux

to filler metal)
 Thumb Rule

In case of on site welding process,

if it is difficult to estimate the
weldment weight. for such case, the
Universal Thumb Rule is
weldment weight is 2% of total
structure’s weight.
 Power Cost.
V x Ax t x 1x1
1000 60 η r x c
Where
• V – Voltage in volts
• A – Current in amps
• t – Welding time in min
• η – Efficiency of the welding machine, (0.6 – Transformer &
0.25 – Generator)
• r – Operating factor
• C – Rate of Electricity per kWhr in rupees
 Theoretical Vs Actual
 Tooling time.
 Fit ups
 Fixture non alignment because of spatter
deposition
 Filler may change, So quality. may change
 Skill varies from men to men.

So we should use Digital communication technology

for monitoring the welding and whether the std. are
followed or not….
 Theoretical Vs Actual

 If we increase the size of fillet weld, the

area of Fillet will be Doubled, And the cost
will increase. And not only that, it leads to
Stress.
 Weld Area Vs. Cost

Note: Labour Cost is 80% of Total Cost

(Based on Typical Modern Welding rates and Efficiency)
 Tips
 Select the cost calculation method that most
directly measures the important cost variables
for the specific application.
 When evaluating the effect on overhead costs,
ask: Will the changes in the welding operations
affect the company throughout?
 Carefully evaluate the impact of the proposed
change on the operating factor. Some changes
will decrease this variable, others will increase
it.
 Make sure the data used for cost computations
reflect reality.
 Some Data
Labor and Overhead
Operating Factor
percent of Total Cost
10 89
20 81
30 73
40 67
50 62
60 58
70 54
80 51
90 48
 Steps to Reduce Welding Cost
 Analyze the delivery of consumable and
accessories to welding point.
 Analyze whether material handling is effective.
 Look for ways to correct over welding.
 Enhance current welding process and
procedures.
 Optimize joint preparation.
 Eliminate any extra welds from design.
 Look for items that can be welded rather than
cast.
 Look for ways to eliminate costly record keeping
 Examine safety concerns
 An Example
 If we consider a boiler drum, there are
linear and circumferential welds.

 That can be done by all kind of welding

processes.

 So here we are going to see some sample

calculations.
 Given Data
 Length – 3m
 Diameter – 1.2m
 Thickness – 15mm
 Both side welding.
 Rate of weld – 2m/hr(outside), 2.5m/hr
(inside)
 Length of electrode required – 1.5m/m of
weld.
 Given Data
 Cost of electrode – 2.75/m
 Power consumption – 4kwhr/m of weld
 Power charge -45 paise / kwhr
 Labour Charge – Rs. 9/hr
 Over heads – 90% of prime cost
 Discarded Electrode – 6%
 Fatigue and setting up time – 5% of weld
time.
 Calculations
 Length of weld:
= 2 x Π x D + (2 x L) = 13.54m
 Total electrode length
= 1.5 x 13.54 = 20.31m
 Electrode Discarded = 6% = 1.22m.
 Total electrode wanted
= 1.22 + 20.31 = 21.53m
 Cost of electrode = Rs.59.21
 Calculations
 Labour Cost
 Length of inside weld = 3m. Time = 1.5hr
 Length of outside weld = 10.54m.
 Time = 4.216 hr.
 Net time = 5.716 hr.
 Total time = net + (Fatigue) = 6 hr.
 Cost = Rs. 54.
 Calculations

 Power Consumption = 4 x 13.54 = 54.16 kwhr.

 Cost = 0.45 x 54.16 = Rs. 24.37
 Prime cost = 59.21 + 54 + 24.37 = Rs. 137.58
 Over Heads = Rs. 123.82 (90%)
 Total Cost = 137.58+123.882 = Rs. 261.40

In other process the process may vary.

But the procedure is same
 Conclusion

 Simplified calculations
make this task easier
 Can find Alternate means
of manufacturing
 Company with economy
and new technology can
and will compete
Successfully
 References
 Process Planning and Cost Estimation – V.
Jayakumar.
 Welding Principles and Applications – Larry
Jeffus
 Design and planning manual for cost effective
welding – AWS.
 www.weldingdesign.com -
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