Challenge: Tender based project planning and costing
The company delivered tender specified CTP pipes and fittings to project sites. Excel was unable to deliver future costs despite long time spent on calculations. Since the tender was priced on the formula “cost + profit”, cost overruns and late site deliveries reduced tender profitability adversely affecting budgeted company profitability.
Solution: Superlit used Reflex for tender based production planning and costing, enabling:
Automatic production planning of tender specied pipes and fitting variants
Transfer of pre-tender stand-by cost to actual production costs after the tender was signed. This method calculated different costs for each tender signed leading to correct tender pricing while achieving budgeted tender profitabiliy.
Simulation of strategic scenario alternatives to mitigate tender risks.
Solution Benefits: By using Reflex, Superlit
- Identified early the “loss bound” tenders to compensate as much as possible for the losses before the ending date of the projects.
- Improved the “tender projects portfolio” by simulating the cash generation potential of prospective tenders.