ICG Consulting has excellent experience in cost engineering & management for our clients.?
Challenge:?A flat glass producer from one of the Asian regions found its expenses to be higher than main competitors’ costs; reducing of overhead and commercial expenses gave a small decrease in cost per ton of glass; a client wanted to analyze its production expenses, cost structure, to compare it with cost structure at competitors’ side, and to find possibilities to reduce production costs with simultaneous optimization of technology.
Approach:?ICG?made in-depth cost analysis for the client’s target products (float glass for construction and automotive); the same job was done for 5 main competitors’ expenses; based on benchmarking results the main problems were found in cullet utilization, in energy costs and labor costs; technology flow analysis gave a vision of other problems – like molten (pull) capacity lower than optimal for this plant, non-optimal number of campaigns for clear/color glass change, possibility to change batch recipe for color glass, and necessity to replace off-line coater.
ICG provided a comprehensive report with indication of a) technical and technological issues found; b) recommendations on their improvement/replacement; c) calculations for Opex reducing at such improvement/replacement; d) calculations for additional Capex/Opex required to make such improvement/replacement; and e) total financial effect for improvement/replacement.
After approval with a client ICG provided a detailed plan for technological modernization – and continued to consult a client during the process.
Value:?A client could reduce production expenses at 12.8% - that made its cost lower than at main competitors’ side; a client wanted to optimize material procurement – for cost further reducing – and asked us to make that job too.