Factors Affecting Unit Cost

Welcome class! Today we'll be discussing the factors that affect the unit cost of earthmoving operations. Understanding these factors is vital for accurate budgeting and cost predictions. Can anyone tell me why understanding cost is important in a project?

It helps us determine how much we can charge for services and what's feasible for our budget.

And it helps in making decisions about hiring and resource allocation.

Exactly! Now, one major factor is job efficiency. If a machine is designed to work for 60 minutes but only works for 50, how do you think that affects productivity?

We would need to adjust our productivity calculations downwards.

Great insight! This adjustment is often done using correction factors. Does anyone know what a correction factor is?

It's a way to account for real-world conditions affecting productivity compared to ideal conditions.

Exactly! Remember the acronym JOMV (Job Efficiency, Operator Skill, Material Type, Visibility) to help recall some of the main factors we will consider today.

Let's talk about operator skill. If we have an operator with average skills, what impact do we think that will have on unit costs?

It will reduce overall productivity since they might not perform as efficiently as an expert.

Yeah, if they take longer to complete tasks, the costs will go up.

Exactly! And when it comes to material type, what can you tell me about using non-cohesive silty sand versus cohesive materials?

Non-cohesive materials are usually trickier to manage and may lead to lower productivity.

Right! To help remember this, think of the phrase 'Cohesive is Cooperative'. More cooperative materials help maintain performance levels.

That makes sense! So if we're working with silty sand, we should expect lower performance and adjust our cost calculations.

Now, let’s discuss visibility. How do poor visibility conditions affect a machine's operation?

It makes it harder to navigate and operate effectively, which can slow down work.

Exactly! Poor visibility will decrease productivity so we need to include that in our correction factors. What about grade, particularly a negative slope?

A decline can actually help with productivity since gravity assists in moving the load.

That means we might even have a higher correction factor for downhill work!

Precisely! Keep this in mind next time you’re calculating costs. Let's summarize today’s key points: job efficiency, operator skill, material type, visibility, and grade all impact unit cost through their influence on productivity.

Now that we understand the factors, let's look at how to calculate unit cost. What do we need to know?

We need to know the hourly cost and the adjusted productivity.

Then, we can find the unit cost by dividing the hourly cost by the productivity.

Correct! For example, if our hourly cost is 1450 and productivity is 55.63 bank meters per hour, how much is our unit cost?

That's around 26.06 per bank meter cube!

Great job! Remember this calculation; it's heavily used in project bidding. Each factor we've discussed affects this bottom line.

So those correction factors are super important for estimating accurate costs!