Determining the Cost of Calibration
Explore the Transcat Quality Program
The Relationship Between Equipment Pricing and Production Expenses
And why neglecting calibration costs you more
The expenses associated with manufacturing vary for each product based on numerous factors. These encompass, but are not limited to:
- Design costs
- Raw materials
- Labor requirements and labor costs
- Degree to which automation can be integrated into the manufacturing process
- Quality assurance expenditures
- Product evaluation costs
- Marketing and sales expenses
- Administrative expenses
- Costs of machinery, tools, and equipment necessary for production, and the maintenance costs of those assets
Considering these factors in detail raises questions about how certain products are sold at such low retail prices. The explanation lies in effective resource and supply chain management that lowers costs along with the advantages of volume sales, allowing companies to operate on reduced profit margins while still remaining profitable.
Calibration Service Costs Are Related to the Calibration Procedure
Although some calibration processes can be automated, the primary expenses for a calibration lab are labor and equipment. Even if when a project allows us to process multiple similar items simultaneously, it doesn’t allow for mass production like that of manufactured instruments. Consequently, there may be situations where items like stopwatches, liquid-in-glass thermometers, or rulers are produced in bulk and sold for less than the calibration costs. Acknowledging that these two processes operate independently is essential to understanding their lack of impact on one another. The same reasoning applies to Original Equipment Manufacturers (OEM) that may provide calibration services for their products; they might choose to absorb losses on calibration to boost product sales, but they must remain profitable overall to sustain their operations.
The Risks of Not Calibrating Far Outweigh the Benefits
Calibration ensures that the decisions regarding your products or services do not lead to false acceptance (risk to consumers) or false rejection (risk to producers), which can significantly impact costs and safety. Discarding an instrument at the end of its calibration interval in favor of a new one may seem more economical, but it requires forfeiting your traceability, potentially resulting in undetected deviations outside acceptable limits that could negatively impact decision-making. To maintain traceability and keep costs predictable, ensure your instruments are properly calibrated.
Contact Transcat for Your Calibration Needs
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