OldTools Archive

Recent Bios FAQ

184213 "Leonard VanderGrinten" <vandes@p...> 2008‑10‑30 Re: Dealer Markup & Bio
Standard Cost & Bio;

Standard cost was figured in the heavy manufacturing industries
(construction equipment or machine tools) by taking the labor cost
(time spent by the machinist to make). Then multiplying by the burden
rate (the burden usually was around 200% but I have worked in plants
where it was as high as 600% this was due to all new equipment & high
overhead costs) (cost of equipment plus all of the costs required to
run a plant).

To this was added the material cost to arrive at a unit cost. Standard
cost was arrived at by multiplying the unit cost by four to get the
standard cost. All the standard costs were added up to get a machine
cost, to this was added a profit margin. Thus you got a selling price of
around $500,000 for a 3 yard backhoe. This company (Koehring) is no
longer in business, the Japanese undercut the selling price, and got all
the business.

Koehler Co. used the 600% burden rate on their twin cylinder line (all
new equipment) and a 200% burden rate on their single cylinder line (all
old equipment). I was an Industrial Manufacturing Engineer from 1956 to
1997 when I had enough of it and retired. I started working as a
Draftsman and advanced to Tool Designer the Tool Engineer and Finally
ended up as Manager of Manufacturing Engineering.

In 1982 my job was eliminated and I found at age 45 that I was "Over
Qualified" this is a buzz phrase of Human Resources to get around saying
that you are "too old". So I started to work doing Contract
Manufacturing Engineering. This proved to be an interesting life style,
not very secure but interesting. Worked for a Varity of companies,
Koehler 4 times, Allis Chalmers Steam Turbine Rebuilding, Danly Press,
Amoco, Mercury Marine, Lear Ziegler, Milwaukee Valve, Cooper Industries,
and finally retired from Mayville Engineering ("MEC" shotshell
reloaders) training CNC Lathe operators how to machine parts.

Started wood working in 1947 in grade school and never have really
stopped since. Have accumulated a fairly extensive assortment of hand
tools old and new and an extensive array of tailed one's. I would like
to thank Jim Esten for pointing out the barn sale last year in which I
acquired a Champion Post Drill No. 97 and a Miller Falls Breast Drill
and 50 augers some of which were Russell Jennings for the princely sum
of $15. I would also like to thank Jim Thompson on alerting me to using
Citric Acid for rust removal. And Scott Grandstaff for pointing out the
proper way to sharpen augers.

I have learned a lot from lurking under the porch. I live in the
township of Lomira in the middle of a section and one-half on a dead end
road. My woodworking projects tend to be Old Farm Rustic, not pretty but
useable and sturdy. I like to Trapshoot and have gotten a few State
class title's mostly in the HOA category, for the people that don't know
what HOA is it stands for High Overall All which means that you shot the
highest total score in Singles, Doubles and Handicap in your class.

Leonard VanderGrinten aka "Nightowl"

----- Original Message ----- From: "Neanderman"  To:
"OldTools Posting"  Sent: Tuesday, October 28, 2008 10:04
PM Subject: Re: [OldTools] Dealer Markup

> Standard markup on trade books is 40%.
>
> At 10/28/2008 08:12 PM, Stephen Noe wrote:
>
>>Eons ago, I managed old W.T. Grant stores - the target gross markup
>>was an average of 35%.
>
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Recent Bios FAQ