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Sat, Jun 15, 2024 17:08
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Management Side

Monopolists Beware

We received the following comments.  The data is over in the "What do you think?" column.

To the question, "Do you think OEM parts are reasonably priced?" selected comments were:

1 They are very unwilling to address the issue
2 Excessive by an average of 200%
3 Typically OEM parts are priced at "what the market bear".
4 Often the initial buying decision does not take parts cost into consideration; so the supplier will not get contract if parts are not revenue stream. Also of concern are the frequent model changes of some manufactures. Case in point [brand name withheld] where thousands of configurations changing frequently. Recently waited 2 months for simple part to be sent from other side of world. 3D fabrication will come, if not in mill then within user mill groups.
5 Sometimes they are more than double priced compared to a more realistic market value
6 Isn't the more important question, "are they a good value?". Mills have had local machine shops make critical replacement parts for equipment that often don't know how they work or what they do. Precision parts for chippers that are off by 0.001's can result in a dangerous and damaging wreck when, for example, a face-plate breaks loose at 400rpm. A shop needs to go through a qualification process and thoroughly understand how and what the part does before a decision is made to not buy an OEM part. It may cost less, but not be a good value choice.
7 My most frustrating experience with OEM parts involved the old Beloit folks. A common problem for us many times at two different mills was that, when we asked for a quote for a part, the price and delivery were so outrageous that we couldn't afford to use them. They forced us to find other solutions just to stay in operation. Could that have had anything to do with the eventual demise of that great company?


What have you done to alleviate problems (price, schedule) with EOM parts?

1 Back in the 60s we found it worth making drawings of pump impellers and having them cast and machined. Pump shafts and many other items were even easier. We had a good machine shop and well paid engineers, supervisors and machinists. Today few mills support such skills adequately.
2 Local supplier, aftermarket sourcing, in house manufacture, in some cases re-design
3 Produced on site drawings and reviewed all spares in a systematic manner to identify as a commercial item.
4 I have purchased non-OEM turbine blades and parts. The manufacturers typically will reverse engineer them and are able to take the old part and fill it out to new condition. They then hold a tighter tolerance than the typical new part since they do not know if the old part was on the large or small side of the OEM tolerance range. Upgraded materials were often obtained at prices well below OEM. After purchasing some, the OEM changed their price structure to me to be competitive with the after market parts makers. I have also done the same with other parts including having casting patterns made so that the non-OEM could rapidly respond (usually much faster) to our needs.
5 Swapped from OEM to "EOM" often with unfavorable consequences long-term or short-term.
6 Cost in at project stage. Price deal in initial contract. Commonality across existing units.
7 First trying to come to terms with the original supplier. Often this helps in the short term. Trying to keep a good relationship might help a little. It this still brings down our face, we shop "elsewhere" for small parts like deflakers and refiner there are a lot of suppliers, and at this moment they start to come from Japan and India. Especially parts that need a lot of craftsmanship is at this moment cheaper over there. If necessary because the original parts are either to expensive, or not on stock, we have some local workshops who do a very good job in making the needed parts. (And often even enhance the quality! E.g. the shafts for refiners from the original manufacturer broke down often within 5 years. Our local guy used a different material, much more expensive, and still was cheaper and the shaft are now used more than 10 years! Further we try to use as much as possible "standard" components, so that you can choose from different suppliers.
8 seek alternates



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