Industrial cost structure

As the previous ehapter discussed nuelear power reactor operation and how to perform a PSA on it, this chapter attempts to apply a similar framework to chemical processing. The problem is the diversity of chemical processing that blurs the focus. This chapter begins by showing that accidents in the chemical process industry cost lives and dollars. Descriptions of deadly chemical accidents arc presented to show the chain of sequences that were involved to suggest how their PSA may be structured. Background on selected hazardous chemical process is presented followed by descriptions of how their PSA have structured. The chapter concludes by applying FTAPSUIT to a pressure vessel rupture analysis. 

The problem of optimizing production from several plants with different cost structures and distributing the products to several distribution centers is common in the chemical industry. Newer plants often yield lower cost products because we learn from the mistakes made in designing the original plant. Due to plant expansions, rather unusual cost curves can result. The key cost factor is the incremental variable cost, which gives the cost per pound of an additional pound of product. Ordinarily, this variable cost is a function of production level. 

The purpose of this chapter has been to provide a broad, general overview of the role of the pharmaceutical industry in the economy and in the health sector, and to explore a number of problems arising from the industry s cost structure and from the traditional imbalance in the global markets for pharmaceutical products. 

Cold sterilization of beer using microfiltration was introduced on a commercial scale in 1963. The process was not generally accepted at that time, but has recently become more common. Sterilization of beer and wine is much less stringent than pharmaceutical sterilization. The main objective is to remove yeast cells, which are quite large, so the product is clear and bright. Bacterial removal is also desirable a 106 reduction in bacteria is equivalent to the best depth filters. The industry has found that 1-p.m filters can remove essentially all the yeast as well as provide a 106 reduction in the common bacteria found in beer and wine. Because the cost structure of beer and wine production is very different from that... 

The interplay of this complex mix of hard and soft factors is best understood by applying a business dynamics approach. A business dynamics model can, for example, simulate the cost structure, economics and investment behavior of a group of players in a commodity industry. The output is the financial performance of the industry - and even of individual players - over time. 

Critics will argue that implementation of this system will cause disruption of current industries, financial structures, worldwide society, and the balance of power among nations. The critics will say that the costs will be large. The critics will be correct. 

These factors brought the collective leadership to recognize within the industry the need to remain competitive and to improve vehicles on a fuel economy basis. Changes to the cost structure while maintaining performance were needed as well. Eventually, this drive would manifest itself in the form of design imperatives of which the chemist would be crucial to development. From a management standpoint, these imperatives are... 

As we will see in Chapter 4, each one of these imperatives is intermingled within the overall structure of the industry and can be considered to play a major role in competitive design. Because design plays such a major role in the overall cost structure of a vehicle (85%), obviously getting it right up front is crucial. 

In order to explain a particular industry s market structure, economists in the field of industrial organization traditionally examine the cost structure of films. For major gas pipelines this style of economic analysis does not go far enough. The most basic economic analysis would appear to paint pipelines as almost classic natural monopolies, but the pipeline business is much more complex and difficult to categorize. To most policy makers, the structure of pipeline markets, for both oil and gas, remains something of a mystery. 

The figures tell more about the nature of the work than of effectiveness. More technicians, more services, and unique research facilities will raise the figure, while simpler organizational structure and prevalence of one to three person research projects tend to lower it. Othe points show up within each sector when we look at Figure 3, which shows the cost per professional person for each sector in constant 1972 dollars. On this basis, each sector has declined. Since 1973, the true industry cost per R D professional has gone down by about 5%, the government by 7%, and universities by about 14%. 

The major drawback of these techniques was the high production cost of the substrates and the requirement of microfabrication in a clean room facility, not affordable for disposable microfluidic devices, and this consideration led the researchers to investigate the possibility of using of photodefinable polymers, converting conventional photoresists that have been already used for patterning, in the microelectronics industry into structural elements of microfluidic devices. 

The impact has been to force chemical manufacturers and converters to reduce their cost structure, delay or abandon capacity expansions, delay equipment upgrades, and minimize their investment in infrastructure. As a result, the chemical industry in the United States and Europe has operated in recent years near their maximum capacity, such that the occurrence of mechanical failure results in a major disruption to the supply chain. The years 2004 and 2005 saw record numbers of force majeures due to unplanned outages and the lack of capacity in the chemical supply chain to compensate for major supply disruptions. "... 

Closing scenarios are influenced by the lack of financial resources needed for investments, typically calculated for a pay-back-time of 10-15 years. Generally, hospitals do not have such sums at their disposal to match those of industry, where 10-15 % reinvestments of the annual volumes of sales are current. Benchmarking with industrial production cannot be more than a virtual cost comparison, because the two markets differ fundamentally and most of the products of hospital production do not compete with industrial ones. In trade, sellers get paid for what they sell. In care, providers get paid for what they do. As a result, it is even not important to analyse and compare cost structures. Some components of cost are only, or mainly, found in industry but not in hospital pharmacies, e.g. gains (around 10 % of the ex-factory price),... 

The properties of PHA copolymers depend strongly on the type, level, and distribution of comonomer units comprising the polymer chains. While PHAs have been investigated by various researchers from academic and industrial laboratories as an interesting class of materials, the successful commercial utilization of PHAs has been slow. The production cost of PHAs by conventional fermentation processes was initially high, making the entry of this material into the commodity plastics market difficult. Limited availability also did not contribute favorably toward the establishment of a robust cost structure and product development. Most importantly, the physical properties of earlier commercial PHAs, like PHBV, were inadequate for many of the applications envisioned for the replacement of commodity plastics. 

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