1. Introduction
This article refines and clarifies the original analysis of precision (chanteur perdu, full-silica-sol) castings costs.
The objective is practical: explain why conventional weight-based accounting understates the true cost drivers of precision castings, show which process factors move cost the most, and describe a transparent,
production-oriented approach to estimating part and per-kilogram costs that both foundries and buyers can use when quoting, negotiating or analysing margins.
2. Accounting practice vs. process economics
Traditional accounting often allocates total manufacturing overhead to castings on a per-kilogram basis.
While straightforward, that method masks important differences arising from part geometry, process yield and downstream finishing.
Two consequences follow:
- Misleading unit costs. A single per-kg average cannot capture how small, complex castings consume more labour and auxiliary materials per finished kilogram than large simple castings.
- Poor pricing signals. Buyers and sellers frequently resort to an average per-kg price adjusted by a subjective multiplier; such multipliers are often benchmarked to a “typical” part or even set by feel, producing inconsistent margins and disputed change orders.
To get realistic, actionable unit costs you must separate direct materials, processus (operational) frais, et period (fixed/administrative) frais, and then allocate each category according to the causal basis that best reflects reality.
3. Direct vs. process vs. period costs — a practical taxonomy
For clarity in cost discussions we adopt the following practical groupings:
- Direct materials: the melt charge (scrap steel, ferroalloys) that forms the casting metal. This is a transparent market cost and varies principally with alloy selection.
The original analysis applies a modest loss-compensation factor (à propos 1.1) to cover melt and trim losses. - Processus (operational) frais: expenses consumed in making the part—wax, shell materials (zircon / zircone, silice colloïdale), labor in wax, shell and melt shops, fuel and power, and the routine maintenance/inspection tied to those operations.
Because these costs rise and fall with the particulars of the process (number of shell layers, rendement, degree of finishing), they are the focus of the analysis. - Period / management overhead: depreciation, rent, finance and corporate support.
These are essentially fixed for the plant over short horizons and are usually apportioned to products by weight or by a negotiated burden rate.
In medium-scale precision foundries the management allocation in the example sits near ¥5 per finished kilogram.
Direct materials plus process costs constitute the variable (direct) coût of a casting; management overhead is treated as a period charge that affects margin and pricing but is not a primary driver of short-term process decisions.
4. Composition of Process Costs for Precision Castings
The full-silica-sol precision casting flow is grouped into four principal stages. Cost allocation must respect the different causal bases of each stage:
- Wax pattern manufacture — predominantly labour and wax material. Best allocated per unit of poured metal when clustered patterns are used.
- Shellmaking — face coat(s), transition and backup coats. Face coats (zircon/zirconia + silice colloïdale) are the most expensive single item and are applied by geometry and surface requirement. Shell costs are highly sensitive to the number of face applications.
- Fusion & verser — furnace energy, charge materials, slag removal and pouring labour. These costs correlate with poured metal weight and with melt cleanliness requirements.
- Post-traitement (finition) — de-shelling, sand removal, cut-off, affûtage, coup de tir, décapage, weld repairs and straightening.
These activities are more closely proportional to finished cast weight but vary sharply with geometry and required surface/ dimensional quality.
In the empirical dataset used in the original work, shellmaking and melting together account for more than 60% of process costs, underscoring their strategic importance.
5. Main Factors Affecting the Cost Difference of Precision Castings
Strictly speaking, the manufacturing cost of different castings in each process is not completely the same, but the differences in some links are small and can be calculated according to the average level.
What we need to focus on are the factors that have a relatively large impact on casting costs.
The main factors leading to differences in casting process costs are as follows:
Process yield (cast weight ÷ poured weight)
The process yield rate, also known as the recovery rate, is the ratio of finished casting mass to poured metal mass for a given cluster/tree.
Typical yields vary broadly (often 30–60%, with many parts clustering 40–50%).
Yield is the most influential single variable because front-end costs (cire + coquille + fondre) are incurred on the poured metal, but revenue and much of the finishing cost are on the finished casting.
The front-end cost per kilogram of castings is inversely proportional to the process yield rate.
The lower the process yield rate, the higher the front-end cost per kilogram of castings, and the more significant the impact when the process yield rate is lower.
Assuming the front-end cost per kilogram of poured molten steel is 6 RMB, when the process yield rate is 45%, the front-end cost per kilogram of castings is 13.33 RMB;
When the process yield rate is 30%, the front-end cost per kilogram of castings is 20 RMB, ce qui est 6.7 RMB higher than the average level, increasing the process cost by 37.6%, and the impact on the total cost of 304 stainless steel castings is about 17%;
When the process yield rate is 60%, the front-end cost per kilogram of castings is 10 RMB, ce qui est 3.3 RMB lower than the average level, résultant en un 18.5% reduction in process cost, equivalent to a decrease of approximately 7% in the total cost of 304 pièces moulées en acier inoxydable.
Taking the derivative of the front-end cost of castings with respect to the process yield rate, it can be concluded that the impact of the process yield rate on the front-end cost per kilogram of castings is inversely proportional to the square of the process yield rate.
When the process yield rate is 45%, chaque 1% decrease increases the front-end cost per kilogram of castings by 0.3 RMB; when the process yield rate is 30%, chaque 1% decrease increases the front-end cost per kilogram of castings by about 0.67 RMB.
It is evident that the process yield rate has a significant impact on costs. Similar to the power factor in electrical engineering, reducing the process yield rate is equivalent to increasing reactive power consumption.
Of course, a higher process yield rate is not always better, nor can it be arbitrarily increased.
An excessively high process yield rate will reduce the feeding capacity of the gating system, leading to insufficient feeding and the generation of shrinkage porosity or shrinkage defects.
D'autre part, some castings, especially irregularly shaped thin-walled castings, are difficult to improve the process yield rate due to the limitations of casting structure and tree assembly plans, which should be considered when verifying casting prices.
Number of Shell Layers
Due to differences in casting shape and structure, the number of shell layers will vary.
Par exemple, castings with slender holes or narrow slots require two or even three surface layers; general castings only need two back layers, while larger castings may require three or more layers.
The average shell making cost per kilogram of castings is about 5.9 RMB, of which materials account for 67.8%, fuel and power account for 23.9%, and wages account for 13.3%.
Among the 4 RMB per kilogram of shell-making matériels, the consumption of zircon sand and zircon powder accounts for about 63%, comptabilité 42.7% of the total shell-making cost, and the cost of silica sol accounts for about 12.2% of the total shell-making cost.
Although zircon sand and zircon powder are only used for surface layer shell making, they become the main item in shell-making costs due to their high price.
It can be seen from the data that the cost of the surface layer is about 4.4 times that of the back layer. De plus, the second surface layer consumes 10% more materials than the first.
It is estimated that the cost of adding one more surface layer is about 6.2 RMB, increasing the cost per kilogram of castings by 2.7 RMB and the cost per kilogram of pouring weight by 1.21 RMB.
Autrement dit, adding one more surface layer increases the shell making cost per kilogram of castings by 45.8% and the process cost per kilogram of castings by 15.1%.
Pour 304 pièces moulées en acier inoxydable, the impact on the total cost and price is about 7%.
Adding one more back layer increases the cost per kilogram of castings by 0.56 RMB and the cost per kilogram of pouring weight by 0.25 RMB, increasing the shell making cost per kilogram of castings by 9.4% and the process cost per kilogram of castings by 3.1%, with an impact of only about 1.4% on the total cost of 304 lacets.
Post-Processing Difficulty
Après avoir versé, castings need to go through post-processing procedures such as shell breaking and sand cleaning, coupe, affûtage, dynamitage, décapage, façonner, welding repair, and finishing to obtain qualified castings.
The average post-processing cost can be verified based on the casting weight. As shown in Table 1, the average post-processing cost per kilogram of castings is 3.33 RMB.
The cost of pickling and passivation for stainless steel castings is about 0.3 RMB per kilogram.
Although carbon steel castings do not require pickling and passivation, considering factors such as the need for box opening after pouring, difficult sand cleaning after box opening, and rust prevention for finished products, there is no need to distinguish the cost difference.
The content and difficulty of post-processing procedures vary with the casting structure.
General castings only need shell breaking, coupe, affûtage, dynamitage, and other procedures after pouring, while some castings require additional procedures.
When customers require additional work such as heat treatment, traitement de surface, and machining beyond the casting blank, the fees should be calculated separately and included in the total price, which is not within the scope of this article.
The difference in post-processing costs mainly comes from three aspects: sand cleaning, deformation correction, et finition.
The cost depends on the casting structure and technical requirements, and the cost difference should be considered when verifying the price.
Sand Cleaning
Some castings with narrow and long slots or slender holes are difficult to clean, requiring sand drilling, acid etching, dynamitage, or alkali explosion to clean thoroughly.
For such castings, the sand cleaning cost needs to be estimated separately.
Mise en forme
Castings prone to deformation need to have their deformation corrected. The difficulty of shaping depends on the casting structure, deformation degree,
and the customer’s requirements for dimensional and geometric tolerances. The shaping cost should be calculated separately.
Finition
The casting process is a special process, and there are many factors affecting casting quality. Objectively speaking, surface defects of castings are inevitable.
Customers with different requirements or castings for different purposes have different requirements for surface quality.
It is very important for both supply and demand parties to determine a reasonable quality acceptance standard based on the casting characteristics and possible surface defects before receiving orders.
If the customer has higher requirements for surface quality, the finishing cost will also be higher.
The finishing cost is mainly affected by the customer’s quality requirements and the first-pass yield of castings; the former needs to be considered in pricing, while the latter depends on internal quality control.
The finishing cost can be adjusted by multiplying the average post-processing cost by an appropriate quality grade coefficient.
6. Allocation of Management Fees
Corporate overhead (depreciation, rent, finance, administration) is commonly allocated to castings on a per-kilogram basis, but its magnitude depends on plant scale and product mix.
The example uses about ¥5 per finished kilogram as a representative management allocation for a medium-scale precision foundry.
Plants with simple, high-volume runs can carry much lower per-kg management burdens; those with diverse, faible volume, high-mix manufacturing will carry more.
En bonne place, management overhead is better viewed as a pricing and margin consideration rather than a short-term process lever.
Decisions to accept low-margin work should consider opportunity cost: producing low-margin castings may displace higher-margin work.
7. Cost Accounting Model for Precision Castings
Based on the above analysis of cost composition and influencing factors, this article establishes a scientific cost accounting model for precision castings, including the average product cost per kilogram and the unit cost of a single casting.
Average Product Cost per Kilogram of Castings
The calculation formulas are as follows:
- Factory Sales Cost = Manufacturing Cost + Management Fees
- Casting Manufacturing Cost = Direct Material Cost + Process Cost
- Process Cost = Front-end Cost + Back-end Cost
- Direct Material Cost = Batching Cost × Loss Compensation Coefficient
- Front-end Cost per Kilogram of Castings = (Average Front-end Cost per Kilogram of Poured Molten Steel + Shell Making Cost Difference) / Process Yield Rate
- Shell Making Cost Difference = Secondary Surface Layer Cost × (Number of Surface Layers – 1) + Back Layer Cost × (Number of Back Layers – 2)
- Back-end Cost = Average Post-processing Cost per Kilogram of Castings × Quality Grade Coefficient
The raw material loss compensation coefficient is used to compensate for the loss caused during melting, coupe, et broyage, which is about 1.1.
The shell making cost difference is calculated based on the pouring weight.
The quality grade coefficient is mainly determined according to the customer’s requirements for dimensional accuracy and surface quality, with a value range of 0.8-1.5.
Substituting the statistically measured data into the formula, we can get:
- Casting Manufacturing Cost = Batching Cost × 1.1 + [6 + 1.21×(Number of Surface Layers – 1) + 0.25×(Number of Back Layers – 2)] / Process Yield Rate + 4.45 × Quality Grade Coefficient
- Factory Sales Cost = Batching Cost × 1.1 + [6 + 1.21×(Number of Surface Layers – 1) + 0.25×(Number of Back Layers – 2)] / Process Yield Rate + 4.45 × Quality Grade Coefficient + 5
Based on the above method, the process cost and factory cost (RMB/kg) of conventional 304 stainless steel castings with different process yield rates and different shell making schemes can be calculated.
Unit Cost of a Single Casting
During the production process, all castings, regardless of size, must go through the specified process flow one by one.
Donc, the actual cost of castings is not completely proportional to their weight, especially for very small castings, the cost deviation calculated by weight is relatively large.
This article calculates the unit cost of a single casting by weighted average of the process cost based on the average cost per kilogram and the unit cost of a single casting at a ratio of 9:1. The formula is expressed as:
Factory Sales Cost of a Single Casting = (Batching Cost per Kilogram × 1.1 + Management Fee per Kilogram of Castings) × Casting Weight + Process Cost per Kilogram × (Casting Weight × 0.9 + Comprehensive Average Weight × 0.1) + Supplementary Process Cost
Substituting the measured data, we get:
Factory Sales Cost of a Single Casting = (Batching Cost per Kilogram × 1.1 + Management Fee per Kilogram of Castings) × Casting Weight + [6 + 1.21×(Number of Surface Layers – 1) + 0.25×(Number of Back Layers – 2)] / Process Yield Rate + 4.45 × Quality Grade Coefficient × (Casting Weight × 0.9 + 0.012) + Supplementary Process Cost
The supplementary process cost refers to the expenses incurred in additional processes such as sand cleaning (par ex., sand drilling, acid etching, dynamitage, alkali explosion) and shaping beyond the conventional process.
Expenses such as heat treatment, traitement de surface, assembly welding, and machining outside the casting process should be calculated separately and are not within the scope of this article.
8. Price Evaluation of Precision Castings
Once the cost of castings is clear, the price evaluation of castings becomes straightforward. Casting price evaluation is divided into pre-evaluation and post-evaluation.
The purpose of pre-evaluation is quotation, while the purpose of post-evaluation is profit and loss analysis.
There are unknown factors in pre-evaluation, and the standard cost can be estimated based on statistical analysis of historical data.
In post-evaluation, all expenses are known, and expenses can be collected by specific products, with the allocation of expenses being as consistent with reality as possible.
The basis for casting price evaluation is the factory sales cost. En outre, expected profit, sales tax, and sales expenses need to be considered.
The formula is expressed as:
Casting Price = Factory Sales Cost + Expected Profit + Sales Tax + Sales Expenses
The determination of expected profit needs to consider many factors with a relatively large variation range, generally around 15%.
En résumé, the main factors to consider for expected profit are as follows:
Market Factors
Including the average profit level of the industry and market competition. Under the condition of a buyer’s market, the price is ultimately determined by the market.
It should be said that the final price is the result of balance reached in market competition. Donc, pricing divorced from the market can only be a one-sided idea.
Casting Characteristics
Mainly including the technical content, matériel, and batch of castings.
Castings with low technical difficulty, large batches, and strong material versatility often face fierce market competition, so the expected profit cannot be too high;
on the contrary, castings with high technical difficulty, long development cycles, petits lots, or uncommon materials can have higher expected profits.
Settlement Method
The main consideration of the settlement method is the payment recovery period. The production and operation process of an enterprise is actually a process of capital flow and appreciation.
The invested capital becomes products through the production process and then recovers the payment through the sales process to complete a capital cycle. In such a cycle, the capital appreciates, and the enterprise obtains profits from it.
The shorter the cycle, the faster the capital turnover, and the more accumulated profits.
Considering the capital operation cost, the time value of capital, and the capital appreciation effect, the impact of the payment recovery period on profits cannot be ignored.
Production Capacity Utilization Rate
An important factor to consider when determining the expected profit is the enterprise’s production capacity utilization rate.
If the factory has surplus production capacity that is not fully utilized, it is actually a waste of resources.
In this case, the expected profit rate can be lower, even zero or negative. A negative expected profit does not necessarily mean increasing losses.
As long as there is a surplus after deducting direct costs, taxes, and sales expenses from the price to share part of the management fees, it can provide a marginal contribution to the growth of the enterprise’s total profit, which is the concept of marginal profit in management accounting.
On the contrary, if the production capacity is insufficient, some castings may not be loss-making according to conventional calculations,
but if their marginal profit rate is low and they consume more resources, they will actually reduce the production capacity of castings with high marginal profit rates.
This opportunity loss can also be regarded as the cost of the product, which is called opportunity cost in management accounting.
In this case, it is necessary to increase the expected profit rate and optimize the product structure.
9. Conclusion
This paper establishes a process‑oriented cost analysis framework for full silica sol moulage de précisions, overcoming the distortion of traditional weight‑only financial accounting.
Process yield, shell layer structure, and post‑processing complexity are verified as the three dominant factors affecting variable process cost.
The standardized cost model supports data‑driven cost calculation and rational pricing for both suppliers and purchasers.
Note that the numerical benchmarks (cost per kg, coefficients, yield ranges) represent industry typical values and will vary by plant location, niveau d'automatisation, energy cost, and product mix.
The cost classification and allocation logic in this paper differ slightly from pure financial accounting standards and should be adapted accordingly for formal bookkeeping.
By applying this model, precision casting enterprises can improve cost transparency, optimize product mix, and support scientific quotation; buyers can conduct reasonable cost audits and avoid overpayment for structurally or process‑constrained components.
