Compare one-off metal prototype fabrication with batch production and see how setup, tooling, material, labor and machine costs affect the cost per part.
Prototype work normally carries a large amount of one-time engineering, setup and tooling cost relative to the number of parts produced. Batch production can spread those costs across a larger quantity.
A prototype is usually produced in very small quantities and may require manual setup, engineering changes, programming, trial cuts, special tooling and additional inspection. These costs can be substantial when spread over one or only a few parts.
Production runs can use repeatable processes, standardized tooling and more efficient machine settings. Larger quantities also allow fixed costs to be distributed over more finished parts.
Prototype fabrication may involve more manual work than established production. Material may also be purchased in quantities that are not optimized for the prototype, creating additional material cost or waste.
For complex fabricated parts, engineering and programming time can represent a significant part of the first-unit cost even when the actual material value is relatively low.
Once a fabrication process is established, production quantities can reduce the average cost per part. Setup and tooling costs are spread across the batch while standardized work can reduce labor and machine time.
The savings are not guaranteed. Very large batches can introduce additional costs such as inventory, storage, handling, inspection and working-capital requirements.
A tooling or setup expense of $1,000 has a very different effect on a single prototype than on a batch of 1,000 parts.
This is one of the main reasons production quantity has such a strong effect on unit economics.
Prototype work can have higher effective material cost because the first part may require trial cutting, less efficient nesting or purchasing a small quantity of stock at a less favorable price.
Production processes can often improve material utilization once the cutting pattern and process are established.
The calculator can help identify a quantity at which the production process becomes economically attractive. However, the decision should also consider whether the design has been validated and whether production tooling and process controls are ready.
A low production unit cost does not justify a production run if engineering changes are still expected.
Why is a prototype usually more expensive per part?
Prototype work often includes one-time engineering, setup, tooling, programming and inspection costs that are spread over very few parts.
Does batch production always reduce cost?
Not necessarily. Larger batches can reduce unit production cost, but additional inventory, storage, quality and handling costs can offset some savings.
What is the break-even quantity?
It is the approximate quantity at which the modeled total cost of the two approaches becomes equal.
Should prototype engineering be included?
Yes, when engineering or programming work is actually required to produce the prototype.
Should production tooling be included?
Yes. Tooling is often a fixed production cost and should be included when it is required for the batch.
Why can production have lower labor hours per part?
Repeat production can use standardized fixtures, tooling, work instructions and optimized processes that reduce the labor required for each part.
Can this calculator be used for welded fabrication?
Yes. Enter the relevant welding labor, machine time, consumables, setup, tooling and inspection costs for the prototype and production processes.
Can this calculator be used for CNC machining?
Yes. Machine time, programming, tooling, setup and production-cycle differences can be represented by the appropriate inputs.