Manager - Costing

JOB DESCRIPTION – Manager – Costing

Department: Costing / Commercial / Estimation

Location: Nashik, Maharashtra

Industry: Engineering / Heavy Fabrication / Structural Fabrication / Manufacturing

Experience: 10–15+ years in costing, estimation and commercial functions

Qualification: B.E./B.Tech. – Mechanical Engineering preferred; MBA/PGDM in Finance/Operations will be an added advantage.

1. Job Purpose

To lead the complete costing and estimation function and ensure accurate, competitive and commercially viable costing for products, projects, fabrication jobs and customer enquiries. The position will be responsible for establishing costing systems, controlling cost assumptions, analysing profitability, driving cost reduction and supporting management in strategic commercial decisions.

2. Key Responsibilities

A. Costing & Estimation Leadership

• Lead the complete costing and estimation function for all new and existing products/jobs.
• Review and approve detailed cost estimates prepared by the costing team.
• Analyse customer drawings, specifications, BOMs, technical requirements and scope of supply.
• Establish standard costing methodology for material, labour, machine, process and overhead costs.
• Ensure timely submission of accurate costing for RFQs, tenders and customer enquiries.
• Review commercial assumptions, margins, contingencies and risk provisions before quotation submission.
• Develop costing models for fabrication, structural steel, sheet metal, industrial equipment and OEM job work.

B. Material Cost Management

• Establish and periodically revise standard raw-material rates.
• Monitor market trends and price fluctuations for steel, consumables, bought-out components and other materials.
• Ensure accurate calculation of material consumption, yield, scrap and wastage.
• Review BOMs and material utilisation for cost optimisation.
• Work closely with Purchase to validate current and projected material prices.
• Identify opportunities for alternate material specifications without compromising quality or customer requirements.

C. Manufacturing & Process Costing

Develop and maintain standard rates for:

• Cutting – Plasma / Laser / Gas
• Shearing
• Bending
• Drilling
• Machining
• Welding
• Fabrication
• Assembly
• Grinding and finishing
• Painting
• Hot Dip Galvanizing
• Heat treatment
• Inspection and testing
• Packing and dispatch
• Subcontracting activities

Review machine-hour rates, labour rates, power costs, consumables, tooling and other manufacturing expenses.

D. Quotation & Commercial Support

• Review and approve costing sheets before submission to customers.
• Support Sales/Marketing teams during customer negotiations.
• Provide costing inputs for price negotiations and revision of quotations.
• Analyse customer target prices and determine feasibility and profitability.
• Evaluate commercial risks associated with new projects.
• Participate in tender/RFQ review meetings.
• Support management in make-or-buy decisions.

E. Profitability & Cost Analysis

• Conduct product-wise, customer-wise and project-wise profitability analysis.
• Compare estimated cost against actual manufacturing cost.
• Analyse material, labour, process, subcontracting and overhead variances.
• Identify reasons for cost overruns and initiate corrective actions.
• Monitor contribution margins and gross margins.
• Provide management with recommendations for improving profitability.

F. Cost Reduction & Value Engineering

• Drive continuous cost-reduction initiatives across manufacturing operations.
• Identify opportunities for:
• Material optimisation
• Scrap reduction
• Process improvement
• Labour productivity improvement
• Cycle-time reduction
• Subcontracting optimisation
• Energy-cost reduction
• Manufacturing method improvement
• Lead value-engineering initiatives in coordination with Design, Production, Purchase and Quality.
• Establish annual cost-reduction targets and monitor achievement.

G. Costing System & Standardisation

• Develop and maintain standard costing formats, templates and procedures.
• Establish standard labour, machine-hour and overhead rates.
• Develop costing databases for repeat products/jobs.
• Maintain historical costing and actual-cost records.
• Ensure proper version control of costing data.
• Develop automated costing models using advanced Excel/ERP/SAP wherever possible.

H. Team Management

• Lead, mentor and develop the costing/estimation team.
• Allocate enquiries and costing assignments to team members.
• Review workload, priorities and turnaround time.
• Establish performance objectives and KPIs for the costing team.
• Conduct periodic review of team performance.
• Train team members on costing methodology, drawings, manufacturing processes and commercial aspects.

I. Cross-Functional Coordination

Work closely with:

• Business Development / Sales
• Design & Engineering
• Production
• Purchase
• Quality
• Maintenance
• Stores
• Finance & Accounts
• Planning
• Dispatch / Logistics
• Vendors and Subcontractors

Ensure proper flow of technical, commercial and cost information between departments.

3. Management Reporting

Prepare and present:

• Monthly Costing MIS
• Quotation status report
• Costing turnaround-time report
• Estimated vs. actual cost analysis
• Product/job profitability report
• Material price variance
• Cost reduction report
• Subcontracting cost analysis
• Customer-wise profitability
• Project-wise cost and margin analysis
• Costing-related management review reports

4. Key Performance Indicators (KPIs)

KPI

Measurement

Costing Accuracy

Estimated vs. Actual Cost Variance

Costing TAT

Average time taken for quotation costing

Quotation Accuracy

Number of costing errors/revisions

Gross Margin

Actual vs. Budgeted Margin

Cost Reduction

Annualised savings achieved

Material Yield

Estimated vs. Actual Material Consumption

Cost Variance

Standard Cost vs. Actual Cost

Profitability

Customer/Product/Project contribution

Rate Update

Timeliness of material/process rate revision

Team Productivity

Enquiries completed per resource

Cost Overrun

Number and value of jobs exceeding estimated cost

5. Authority & Decision-Making

The Head – Costing will have authority to:

• Review and approve costing prepared by the team.
• Recommend minimum acceptable margins.
• Challenge abnormal material/process costs.
• Recommend alternative manufacturing processes.
• Recommend make-or-buy decisions.
• Recommend cost-reduction initiatives.
• Seek quotations and cost inputs from vendors/subcontractors.
• Escalate commercial and cost risks to senior management.
• Recommend revision of standard costing rates.

Final commercial pricing/quotation approval shall remain as per the company's defined authority matrix.

6. Required Technical & Functional Competencies

• Advanced knowledge of manufacturing and fabrication costing.
• Strong understanding of engineering drawings and BOM.
• Knowledge of MS/SS materials, sections, plates and sheets.
• Strong understanding of welding and fabrication processes.
• Knowledge of machining and finishing processes.
• Knowledge of galvanizing and painting processes.
• Strong understanding of labour and machine-hour costing.
• Knowledge of overhead allocation and absorption.
• Strong financial and commercial understanding.
• Advanced MS Excel skills.
• ERP/SAP costing experience preferred.
• Good understanding of P&L and contribution margins.
• Strong analytical and negotiation skills.

7. Educational Qualification

Essential:

B.E./B.Tech. – Mechanical Engineering or equivalent.

Preferred:

MBA/PGDM – Finance / Operations / Supply Chain / Commercial.

8. Experience

10–15+ years of relevant experience, preferably in:

• Heavy fabrication
• Structural steel fabrication
• Sheet metal fabrication
• Industrial equipment manufacturing
• Engineering products
• OEM manufacturing
• Project-based manufacturing
• Job-work/fabrication industry

Experience in a leadership role managing a costing/estimation team will be preferred.

9. Personal Competencies

• Strong commercial acumen
• Leadership and team management
• Analytical thinking
• Strategic decision-making
• Attention to detail
• Problem-solving ability
• Strong negotiation skills
• Customer orientation
• Ownership and accountability
• Excellent communication and presentation skills
• Ability to work under tight RFQ/quotation deadlines

10. Major Deliverables

The Head – Costing shall be responsible for ensuring:

1. Accurate and timely costing for all enquiries.
2. Competitive and profitable quotations.
3. Reliable standard costing rates.
4. Effective estimated vs. actual cost monitoring.
5. Improved product/job profitability.
6. Continuous reduction in material and manufacturing costs.
7. Proper control of costing assumptions and databases.
8. Strong coordination between Sales, Engineering, Purchase, Production and Finance.
9. Development of a capable and independent costing team.
10. Data-driven costing support for strategic management decisions.