Cutting fluids are a small line item in manufacturing, comprising less than 1% of the average operating budget. Many facilities try to save money by choosing coolants based on their upfront price, but this could actually create higher operating costs in the long run.
Cutting fluid performance has a significant impact on every aspect of a machine shops operation. Choosing a high-quality, advanced metalworking fluid over a low-cost option could create dramatic savings in productivity and a reduction in waste. You need to go deeper than the price per gallon and consider the total cost of ownership (TCO) when evaluating coolants.
The total cost of ownership is a financial estimate that helps buyers assess both the direct and indirect costs of a purchase. In the manufacturing sector, businesses fulfill customer needs by completing a series of activities, all of which cost money and resources. Total cost of ownership is an attempt to measure the value of a product based on how it impacts these activities and resources. Fewer activities and lower resource consumption results in a lower total cost of ownership.
Advanced cutting fluids have a longer sump life and work at lower concentrations than conventional fluids and extend tool life. With reduced usage, longer tool life, and increased productivity, they offer a much lower total cost of ownership than fluids with lower upfront costs. Here’s how to calculate your cutting fluid’s TCO:
The base cost of fluid spend, and purchase price per gallon, of cutting fluid is self-evident. You can measure this by the price and number of gallons purchased in a given timeframe, but since the real value of advanced cutting fluids is more apparent over time, it makes more sense to measure TCO by year.
The hidden costs associated with cutting fluid ownership take a lot more time to calculate. You want to consider:
The TCO of an advanced cutting fluid is best understood in comparison to a conventional cutting fluid. You also want to factor in indirect costs that are associated with cutting fluid performance, such as:
Advanced cutting fluids can cost more per gallon than conventional formulas, but their ability to lower costs in other areas can completely transform operations. The newest generation of coolants reduces waste, lowers carbon emissions and helps machine shops run at peak efficiency. In fact, one customer was able to use TRIM™ MicroSol™ 585XT in their sump for two years at maximum performance before finally changing. Extending tool life also unleashes remarkable savings. One aerospace manufacturer was able to extend tool life by more than 200%, and save more than $69,900 per year with TRIM HyperSol 888NXT.
For help calculating your TCO and reaping the benefits of advanced cutting fluids, email us at [email protected].