Case Study · Cost Optimization
Industrial Equipment Cost Optimization.
Offshore engineering team for a US-based industrial equipment manufacturer — driving cost transformation without compromising quality.
Client Profile & Overview
Build & Operate engagement.
Client Profile
North American Industrial Equipment Manufacturer
A reputed North American manufacturer in the industrial equipment sector, offering products such as pressure washers, air compressors, and other commercial-grade machinery. To remain competitive in a price-sensitive market, the client partnered with Cognition IES to establish a dedicated offshore engineering and cost optimization team.
Project Overview
The engagement aimed at driving a complete transformation in product cost, design efficiency, and manufacturability. Through our Build & Operate approach, Cognition IES established and managed a specialized engineering team to support design improvements, benchmarking, and cost control initiatives.
Objectives & Team
Client objectives & roles.
Client Objectives
Roles Built
Execution Strategy
Build & Operate strategy.
Team Setup & Onboarding
- Recruited, trained, and deployed a cross-functional engineering team aligned to client goals.
- Enabled seamless integration with client's internal teams via virtual and physical collaboration hubs.
Cost Benchmarking & Value Engineering (VAVE)
- Reverse-engineered competitors' products for cost-performance insights.
- Conducted deep-dive analysis of existing product families to identify material and design inefficiencies.
- Applied VAVE and should-costing techniques to optimize part and assembly-level costs.
Modular Design & SKU Rationalization
- Simplified and standardized SKUs across product families.
- Identified over-engineered components and proposed modular redesigns to reduce tooling, inventory, and fabrication costs.
Cross-functional Collaboration & Knowledge Transfer
- Conducted design workshops with sourcing and manufacturing teams.
- Delivered training and documentation for long-term internal use and continuous improvement.
Analysis
Key findings & deliverables.
Key Findings
Major weight savings and design simplification opportunities across valves, cradles, tanks, and support structures.
Several client components were over-engineered, leading to excess material usage and fabrication costs.
Benchmark competitors utilized fabricated or modular designs with fewer parts and less hardware.
Opportunities to standardize SKUs across product families were identified to improve inventory and sourcing efficiency.
Hydraulic tanks, filter systems, and frames showed potential for leaner, cost-effective alternatives.
Deliverables
Results
Business impact & gains.
Business Impact
| Metric | Before | After |
|---|---|---|
| Manufacturing Cost per Unit | 100% | 65% |
| Gross Profit Margin | ~30% | 45–50% |
| Component Count (Avg.) | High | Reduced |
| Part Standardization | Fragmented | Streamlined |
| Engineering Complexity | High | Optimized |
| Time-to-Market (Future SKUs) | 100% | ~70% |
Summary of Gains