Cost analysis is an important aspect a chemical engineer considers before production starts. The level of growth of a firm is dependent on the cost implementations and strategies employed in production. The reason why a chemical engineer is needed in this cost analysis is in the consideration of energy and material balancing involved.
There are several factors considered by both a starting and an already established firm considers for there to be a quality products after production, such are the labor, capital in which the cost analysis fall under.
Now, considering the subject matter, it is discovered that customers goes for products that are of good quality and at an affordable price, for a chemical engineer in production; it is your duty to look out for the cost factors that will give you the desired taste in production in order to satisfy your customers. Notice this: “quality first before quantity”
From the above process, the cost to be considered include the following: raw materials, energy, catalyst disposal cost, revenue from the product and many more.
- RAW MATERIAL: raw material is the bed rock of production, but here a chemical engineer looks out for the quality of the raw material needed for production which is based on the purity of the raw material. If the raw material is impure therefore a cost is added on getting a purifying machine to under purification process for quality assurance purpose. Notice this adds to the production cost of the firm and the purity of the raw material will determine the quality of your product.
- ENERGY: production cannot start if there is no source of energy, therefore a cost on the type of energy to operate on is considered. As a mindful chemical engineer, this is where your energy balance sets into production.
- CATALYST: Some reaction can take up to weeks and month to take place, to fasten the reaction to reach equilibrium point; a catalyst is need in production.
- WASTE PRODUCTS: From the context of material balance, it is observed that side reactions occur in production and this leads to unwanted products. Some waste products can a means of revenue generation to some firms, and also a loss to some firms. In the cost analysis of the firm to minimize the waste products, a recycle machine or process is provided, this too adds to the budget of the firm. For effective management of the environment, waste is dispose properly and this also incurs a cost in production.
- PRODUCTS: This is the main aim of production. The quality of the product is determined by the effectiveness of the process, and this determines the quantity and the price tag of the product. This is a major source of revenue to the firm and a careful observation is made by a chemical engineer un control of production.
Consider a Heber process, as a chemical engineer undertaking this contract, state the major cost of your production that will aid your firm maximize their profit.