Which line do you start a case cost breakdown with?

Answer: Material. At 45% to 55% it checks directly: 3.4 kg at 9.25 CNY per kg plus 1.5% scrap gives 31.9 CNY, and if that line fails the other five do not matter.

How do you back out six lines from a single 58 CNY price?

Answer: Use the bands, then calibrate on weight. Material 26.1 to 31.9 CNY, labour 7 to 10.44, tooling 1.74 to 2.9, packaging 2.32 to 3.48, overhead 3.48 to 4.64, and profit takes the rest.

What if the supplier refuses a 3% to 5% reduction?

Answer: Trade it for two verifiable items. Dropping 0.2 kg is worth 3.4 CNY, more than the 2.9 CNY that 5% delivers, and scrap from 8% to 1.5% saves another 2.1 CNY.

Is a 40,000 case amortisation base reasonable?

Answer: It depends on the rolling volume. A 120,000 CNY mould over 40,000 cases is 3 CNY each, over 20,000 cases 6 CNY; at 12,000 cases a year the term should read 24 months.

Can the 6% to 8% overhead be cut?

Answer: The basis can, the rate rarely. At 7% on 45.8 CNY of cost it is 3.2 CNY, at 8% on the 58 CNY price 4.64 CNY. Agree the basis, then argue the rate.

Case Cost Breakdown: Annual Cost-Down Negotiation

Quick answer: A 58 CNY case splits into six lines: 31.9 material, 10.44 labour, 2.9 tooling, 3.48 packaging, 4.06 overhead, leaving 5.2 CNY of profit at 9%.

Cutting the six lines
Material at 45–55%: kilos first
Labour at 12–18%: hours per case
Tooling, packaging and overhead
Step-down pricing and the 3–5% trigger
The three lines a quote cannot fill
FAQ

1. Cutting the six lines

A quote saying only 58 CNY cannot be negotiated. Split six ways: 31.9 material, 10.44 labour, 2.9 tooling, 3.48 packaging, 4.06 overhead, totalling 53.8 CNY and leaving 5.2 CNY of profit at 9%.

The order matters. Material comes first because it holds 45% to 55% and a scale plus a price list can verify it. Labour follows at up to 18%, the ceiling that keeps assembly visible. Tooling, packaging and overhead add 13% to 19% and are the lines most often folded into one vague number; profit sits last at 8% to 12%.

A case cost breakdown does not get 58 CNY right to the cent; it shows which line sits outside its band. Material at 38% means weight was cut, labour at 25% means a loose process, overhead at 12% means profit hides inside a fee.

2. Material at 45–55%: kilos first

Material has one formula: weight times price, plus scrap. A 3.4 kg case at 9.25 CNY per kg gives 31.45 CNY, and 1.5% for runners and start-up scrap adds 0.47 CNY for 31.9 CNY.

Per kilo and per case must convert both ways. A supplier quoting 17 CNY per kg turns 3.4 kg into 57.8 CNY, within 0.2 CNY of the quote, and 3.6 kg into 61.2 CNY at the same rate.

Case cost breakdown costing check in an empty aisle, an olive green case on a scratched steel bench, grey foam lid, kraft paper packs below

Weight per case	Blended rate	Cost per case	Versus 3.4 kg
3.2 kg	17 CNY/kg	54.4 CNY	−3.4 CNY
3.4 kg	17 CNY/kg	57.8 CNY	Base
3.6 kg	17 CNY/kg	61.2 CNY	+3.4 CNY
3.8 kg	17 CNY/kg	64.6 CNY	+6.8 CNY

Weight is easier to move than rate. A 0.2 kg difference is 3.4 CNY, or 5.9% of a 58 CNY case and twice the 1.74 CNY a 3% cut delivers, and a 1 g scale checks it: weigh five cases, take the median, ask whether runners count.

Scrap rate matters more than unit price. A claim of 1.5% is normal, 8% needs an explanation: either heavy start-up rejects or regrind priced in. Each extra point adds 0.32 CNY per case, or 7,680 CNY a year at 24,000 units.

3. Labour at 12–18%: hours per case

Labour is hours times rate. At 0.40 h per case, split into 0.05 h demoulding, 0.08 h trimming, 0.15 h assembly and labelling and 0.12 h packing, a rate of 26.1 CNY per hour gives 10.44 CNY, exactly 18% of 58.

Splitting hours by operation makes labour negotiable. Cutting stations from six to five saves 1.7 CNY per case, while cutting the hourly rate from 26.1 to 24 CNY saves 0.84 CNY, so ask about motions rather than wages.

Changeover spreads in too. On 1,200 units, 1.5 h with four people adds 0.005 h per case, or 0.13 CNY; at 300 units it becomes 0.02 h and 0.52 CNY, lifting labour from 18% to 19%.

4. Tooling, packaging and overhead

Tooling amortisation is the only line with a clock on it. A 120,000 CNY mould over 40,000 cases costs 3 CNY each, 5.2% of 58, and over 20,000 cases 6 CNY, 10.3%. Negotiate the base, not the amount.

Case cost breakdown reconciliation of a closed olive green case on its side on a grey steel rack, two black latches, folding handle, scuffed shell

Packaging looks small and holds 4% to 6%. The 3.48 CNY comes from carton, lining and pallet: a pallet at 20 cases over 8 trips costs 0.3 CNY, a five-ply carton 1.9 CNY, and arguments start with the lining at 0.6 CNY between EPE and moulded pulp.

Overhead is charged on material plus labour plus tooling, not on price. Those three add to 45.8 CNY, so 7% is 3.2 CNY; applying 8% to the 58 CNY price bills 4.64 CNY and collects 1.4 CNY extra at the same rate. One question about the basis usually brings a recalculated quote.

5. Step-down pricing and the 3–5% trigger

An annual reduction is not market sentiment; it is the shape of the cost curve. Fixed weight, fixed hours and a falling amortisation line produce 3% to 5%, and demanding 8% buys corner cutting.

12 month rolling volume	Reduction	Per case at 58 CNY	Annual saving
12,000 cases	3%	1.74 CNY	20,880 CNY
24,000 cases	4%	2.32 CNY	55,680 CNY
36,000 cases	5%	2.90 CNY	104,400 CNY

The trigger runs on a rolling 12 months, not a calendar year. Calendar years invite a year-end push and a January reset, and suppliers hold the discount until the fourth quarter.

Write it as no volume, no reduction, no back-payment. Back-payment only persuades the supplier to add 2% in January, which the buyer funds. Take the cut as a unit price rather than a rebate: 4% at 24,000 cases is 4,640 CNY a month.

6. The three lines a quote cannot fill

The first is weight and scrap left joined. A quote saying material is 32 CNY without weight, rate and scrap cannot be checked, and the three numbers usually arrive within one working day of asking.

The second is an unwritten amortisation base. Tooling at 3 CNY per case means 40,000 cases or 20,000, and the difference is 3 against 6 CNY. Base, term and treatment after it belong on the quote.

The third is overhead charged on price, which charges overhead on profit as well and produces the 1.4 CNY gap. Move the basis to material, labour and tooling and the quote loses weight at once.

If one of the three cannot be filled, the quote is not comparable. That is the value of a case cost breakdown: not beating a supplier down, but putting two quotes on one basis.

Conclusion

A case cost breakdown settles into a six-line table reused every year, not a discount won once. Check material at 3.4 kg and 9.25 CNY per kg for 31.9 CNY, labour at 0.40 h and 26.1 CNY per hour for 10.44 CNY, tooling at 120,000 CNY over 40,000 cases for 3 CNY, packaging at 3.48 CNY and overhead at 7% of cost for 3.2 CNY. With six lines filled, profit surfaces on its own: 5.2 CNY on 58 CNY, 9%, inside the 8% to 12% band. Three actions follow: get weight and scrap to one decimal place, write the base onto the quote, and move overhead from price to cost. Where the table cannot be filled, ask for numbers before asking for price.

Line	Normal band	At 58 CNY	The question to ask
Material	45–55%	31.9 CNY	Weight, rate and scrap, each to one decimal
Labour	12–18%	10.44 CNY	How the hours split by operation
Tooling	3–5%	2.9 CNY	Where the base and term are written
Packaging	4–6%	3.48 CNY	How lining and pallet are spread
Overhead	6–8%	4.06 CNY	On cost or on price
Profit	8–12%	5.2 CNY	What is left after the other five

This article discusses container-side specifications and design implications only, and does not cover any handling, loading or use of the contents.