Published 2026-07-23 · Practical guides · Process Economics
What Does the Tool Cost per Good Part?
A worked example that separates tool price, cycle time and tool changes without double-counting costs.
A more expensive tool can cost less to run, but only if its life, cycle time and quality support the claim. Compare cost per accepted part or hole, not purchase price alone.
Choose the costs you will compare
Include consumed cutting tools, machine time and tool-change time on the same basis for both options. Count accepted output. Record scrap and rework separately so a fast tool does not look cheaper by producing unusable parts.
Treat a new body or holder as a separate investment or allocate it over a stated production quantity. Do not charge one option for a new holder while ignoring an equivalent purchase for the other.
Work through an example
Illustrative example, with no rejected parts and cycle times that exclude the tool changes: Tool A costs $60, makes 100 accepted parts and takes 90 seconds per part. Tool B costs $90, makes 150 accepted parts and takes 75 seconds per part.
Both consume $0.60 of tooling per accepted part: $60 / 100 and $90 / 150.
At a $90 hourly machine rate, cycle time costs $2.25 per part for A and $1.875 for B. Each four-minute tool change costs $6 at that rate. Spread across tool life, that adds $0.06 per part for A and $0.04 for B.
A totals $2.91 per accepted part. B totals $2.515, a difference of $0.395 under these assumptions. The $90 tool has the lower modeled cost.
Avoid counting the same time twice
If measured cycle time already includes tool changes, do not add them again. If the machine rate includes labor, do not add the same labor separately. Apply the same cost boundaries to both tools.
Faster cycles do not automatically reduce a cash expense. Establish whether the released capacity can shorten a bottleneck, avoid overtime or produce needed work.
Record enough to repeat the result
Keep the exact tool and setup, material, cutting data, accepted and rejected counts, reason for each tool change, measured times and rate assumptions. Repeat the trial before using one unusually good cutting edge as the purchasing baseline.