Over the past 3 years, the Covalex customer has suffered cost increases of >15% on its product due to raw material price increases, inflation and energy cost increases, which could no longer be compensated for by conventional productivity gains. As both the product and the cost structure cannot be passed on to the end customer, the customer and their end customer engaged Covalex to independently audit the costs.
Initially, the customer granted Covalex full access to its systems (drawings, process flows, cost structures, purchase prices, supplier cost break-downs, etc.). The cost model was created based on this and the individual components were also recalculated using a Should Cost Analysis. The assembly contents were also verified and commercially evaluated.
The cost developments over the last three years were then assessed. The focus here was not only on the increases due to raw materials, energy and inflation, but also on the realised savings/productivity increases within the entire value chain.
As a result, a summary of the respective cost blocks was presented to the customer and the end customer. In addition, a recommendation was given for adjusting the price and the future handling of cost increases. This analysis helped the end customer to understand the cost increases and to find an acceptable solution together with his supplier.
