Activity 2.5
A.) What do you think are the relative contributions of the raw materials and the machinery to the final cost of the pen to the customer?
The relative contributions within the manufacturing process of the ball point pen will include some of the materials that are used. For example, the brass ball is manufactured in bulk but to such precession that the machinery involved will be extremely expensive; Furthermore, the brass used to produce the ball point will be the main cost within a singular pen. However, with the balance of the computer controlled lathe meaning production can continue at a rapid pace the price of the material is near enough balanced when in perspective off how many can be produced at once.
Moreover, the plastic that is used during production has to be made into multiple parts for the pen for example you have the outer barrel, the ink tube and the plastic plugs that the ink tube fits into. Each of these items will require a separate manufacturing process, so as much as the plastic may not be too costly in the grand scheme it will actually be one of the biggest costs due to the number of varied components it has to produce. To conclude the machinery used within the production process will be by far the biggest cost which will in pact more what the customer is paying for than the actual pen product. However due to the demand the machines are able to meet, the cost of production balances by the amount of pens the machines are capable of producing in a short amount of time.
B.)
When is most investment required for producing the pen.
The main investments required for producing a pen will be within the cost of buying and the upkeep of the machinery. This also has other investment requirements such as a facility to hold the machinery. Additionally, if the machinery goes wrong at any point how much will this cost to fix, will someone be employed with the purpose of keeping the machines working?
If analysing the investment purely based on the product, then the most investment will come when producing the steel balls. All though this is done via machinery thinking of the entire production process including getting the brass to the point where it can start to be moulded into the ball shape, makes this the longest process from starting point to final product. It is also the most significant part of the pen and precision at assembly point is key.