Scoring Method: Financial Analysis

The added value will be determined with the use of the measurement plan, and thus the effectiveness of the washing line. Based on the outcome of the added value a score will be made.

The scoring will consist of 2 financial parts, the fixed and the flexible costs:

Flexible Costs

1. Measurement Plan: Total costs of the all Inputs, or materials and supplies: Vitens Water, Source Water, Electricity, Additives, Big Bags and Resource Input. These costs are elements, measured by the measurement plan.

In this research the prices are based on the experience of the head sales.

2. The average expected Selling Price of the end productincluding the transportation costs. The average expected selling price is price in between the expected minimum and the expected maximum price.

(a) Discussion: A more detailed look can be made in the total handling costs of a freight. The density of the produced output big bags and waste deviate per freight. Depending on the material, a full big bag can contain 600 Kg of material or close to 1000 Kg of material. The total handling can deviate per freight and thus makes it harder to produce at a certain speed.

(b) Reason: The value added to a resource product depends on the selling price of the end product.

(c) If the product is processed internally, then the selling price is based on the price, that the company would get if they to sell it to a customer. This has to be done preferably by the same person every time it is processed internally and in con- sultation with all sales personnel.

Fixed Costs

The following are considered to be over the time of one year in which the HKW is 48 weeks a year, 5 days a weeks, 16 hours a day in use. For the FWL it is 48 weeks a year, 7 days a weeks, 24 hours a day in use. If changed, it tis mentioned otherwise. This way the costs are relevant and only have to be adjusted yearly.

The current uptime of the HKW is 63 % and of the FWL is can’t be calculated properly.

Important AssumptionThe calculation can be found in the appendix??.

In the fixed cost and Salary calculation we will make use of a 75 % uptime. The assumption that is used is that the striving up time of the shredder is 75 % procent. It is regarded that the 75 % is the up time in which the production line is producing output. The downtime is regarded with rebuilding time and down time due to maintenance. 3. Overhead of the Production Line: that has been budgeted for the year. These

include: Operator costs, costs of the forklift, maintenance of the production line and all other costs related to the Production Line. Also the slik waste production and the amount of PolyAanmaak-additive consumption over a year.

4. Failure Event Due to Input:This can be divided into 2 sections:

The total amount of time of a failure event: This is the time that the production line is down, due to a failure event caused by the resource input.

The extra costs made to due to a failure event: These are the extra expenses that have been made to get the production line running after a failure event.

5. Company Overhead: that has been budgeted for the year. This includes all costs needed to keep the production lines running.

This is currently not considered, because they were not supplied in time.

Financial Analysis

More information on the financial analysis can be found in Appendix L. An costs analysis of the FWL can be found in table L.2. An costs analysis of the HWK can be found in table L.3. An analysis of the production costs can be found in L.5 for the HKW and in L.2 for the FWL. The scoring method will be based on all the costs made by the washing line, in order to create the washed end product.

the costs can be found in appendix L. This also includes the electricity documentation L.1 and the water cleaning bill L.2.

Important Assumptions

For the Disposal of water into the sewage, the company pays an fee per contamination unit. We assume that the distribution of the costs is the following:

1. A third of the costs for the FWL, a third of the costs for the HKW, a third of the costs for the Extruder Lines.

2. There are 2 operators for both lines, working a shift of 8 hours per day, 5 days a week.

Continuously Update

The cost calculation have to be kept up to date. This is because of the following reasons: 1. This way the scores can be compared and stay relevant over the total life span of the

production line.

2. Over the time in which the production line is in use, all costs post can change signifi- cantly or differ from the budgeted costs. It is applicable for both the fixed and variable costs. The Balance between the different costs post can differ per year.

For example, due to a new Collective Labour Agreement the costs of a hiring one em- ployee increases significantly. This could mean that the original Freight Scores change significantly and other freights come out to be more preferable than before. This way you keep the scores up-to-date and relevant.

3. Purchasing and selling prices could change significantly due to change in for example regulations and market price. This has also an effect on the Freight Score.

4. New costs post could occur, for example the CO2-taxs. Depending on the product, this has also an effect on the Freight Score.