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Elements and Performance Criteria

1. Gather information
   • Details of the particular product and competition products are obtained
   • Details of the proposed production operation are obtained and analysed
   • Labour unit cost projections are obtained and agreed
   • Logistic support contracts, supply agreements or equivalent are obtained and analysed
   • Details of proposed warehousing and physical distribution systems and related cost factors are obtained
   • Information is converted to usable form and stored ready for retrieval and application
2. Estimate materials and labour
   • Types and quantities of materials required for production are estimated and recorded
   • Time requirements for production activities and other lead times are estimated
   • Labour requirements for direct production and handling operations are estimated and recorded
3. Determine and calculate overheads
   • Components contributing to overhead costs are identified
   • Overhead costs to be attributed to work in accordance with commercial and enterprise procedures are identified
4. Calculate production costs
   • Total materials costs and labour costs are calculated in accordance with enterprise procedures
   • Total production cost is calculated, including overheads and mark-up percentages
   • Final cost to customer is calculated in conjunction with marketing/sales personnel
5. Document details and verify, where necessary
   • Details of costs and charges are documented in accordance with enterprise practice
   • Costs, calculations or other details are verified by other enterprise personnel, as required
   • Details are documented for future reference in accordance with enterprise practices

Range Statement

Specifies different work environments and conditions that may affect performance. Essential operating conditions that may be present (depending on the work situation, needs of the candidate, accessibility of the item, and local industry and regional contexts) are included. Range is restricted to essential operating conditions and any other variables essential to the work environment.
Unit context includes:	work health and safety (WHS) requirements, including legislation, building codes, material safety management systems, hazardous and dangerous goods codes, and local safe operating procedures or equivalent work is carried out in accordance with legislative obligations, environmental legislation, relevant health regulations, manual handling procedures and organisation insurance requirements work requires individuals to demonstrate organisational and administrative ability, discretion, judgement and problem solving work is undertaken in accordance with established procedures involving a range of products, equipment and installation sites interaction with customers and other personnel from the operator's workplace
Tools, equipment and resources include:	measuring equipment product sales literature product samples
Overhead costs include:	rental/lease costs utilities non-production resources depreciation of plant and equipment warehousing margins physical distribution unit costs insurance other costs incurred by doing business
Personal protective equipment includes:	that prescribed under legislation, regulations and enterprise policies and practices
Information and procedures include:	enterprise production plan and schedule enterprise financial management policy and procedures enterprise policy and procedures for cost and apportioning overheads labour employment costs (awards, enterprise bargaining agreements and contracts) material/supply costs (contracts, standing agreements, market rates and warehousing margins) physical distribution contracts or arrangements Australian, international and enterprise quality standards and procedures

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Performance Evidence

Collect, organise and understand information related to multi-trade work instructions and work orders, building and structural plans and safety procedures

Apply safe handling requirements for equipment, products and materials, including use of personal protective equipment

Identify materials used in the work process

Follow work instructions, operating procedures and inspection processes to:

minimise the risk of injury to self or others

prevent damage to goods, equipment and products

maintain required production output and product quality

For a significant mass production operation, determine the production and product costs using the following or equivalent steps:

obtain all information relevant to the determination of costs

interpret plans, specifications and instructions for production and materials to be used

estimate quantities of materials required

determine the types and amount of labour required to complete the work

estimate time required to complete the work

determine/calculate overheads

document the process and outcomes

Use mathematical ideas and techniques to correctly complete measurements, calculate area and estimate material requirements

Communicate ideas and information to enable confirmation of work requirements and specifications and the reporting of work outcomes and problems, interpret basic plans and follow safety procedures

Use workplace technology related to the coordination, including communication equipment, time and management aids and other measuring devices

Avoid backtracking, work flow interruptions or wastage

Work with others and in a team by recognising dependencies and using cooperative approaches to optimise work flow and productivity

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Knowledge Evidence

Production systems documentation processes

Enterprise costing procedures

Mathematical formulae and processes relevant to costing

Components of labour costs

Enterprise/commercial approach to overhead costs

Enterprise/commercial approaches to warehousing and physical distribution costs

Enterprise information management processes, including storage requirements

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