Just how expensive are premium steels?

[knerd]

To get this back to the topic at hand. (AKA not just about how Kershaw makes there JYD II...)

How much of the cost of a knife that uses premium steel is attributable to the premium steel?

It all depends on the labor involved, yes premium steels will be more expensive than say AUS8 or lower steels but a lot of the cost is from the manufacturing process. Like stated earlier, harder/premium steels will require more machining than cheaper softer steels. It's hard to say if the price of a knife is directly attributed to the premium steel. There are knives out there with premium steels that are cheaper than some knives made with lower end steels (Buck Vantage Pro comes to mind). It varies from company to company, but it's safe to say the price of a knife is reflected by the amount of work that goes into the manufacturing and not necessarily the steel used.

 

[Knife Outlet]

Making a composite blade costs more than making a solid blade despite what the raw materials cost. There are two reasons for doing it. One would be cosmetics and the other would be combining the strengths and weaknesses of two steels to end up with more effective blade overall. Personally, I think cosmetics is probably the major reason. The stainless spine may add some toughness to the combination but, in my experience, D2 doesn't need much help in that department.

And for Antonio, a composite blade is not laminated. Laminating is the process of building up a thickness by combining thinner layers of material. Putting two different materials together side by side wouldn't fit the definition. It is also important to note that San Mai is a trade name belonging to Cold Steel, not a method of laminating steel. The Japanese call this process "warikomi." I don't know what the Scandanavians call it but they don't call it San Mai. The best term for it in the Western world is probably just "laminated."

 

[J.Mattson]

Often times premium steels are followed by premium materials such as G-10, CF, Ti, better fit and finish, better locks and other things. These are attribute to the cost of the knife.

 

[Swedge]

In this thread.

Here

and

here.

Great link. Thanks.

Thomas W thanks for the info. Not to pry, but based on the comments you made, are you employed by Kershaw?

 

[Thomas W]

Making a composite blade costs more than making a solid blade despite what the raw materials cost.

Contrary to the above post, as I mentioned in earlier threads, there is no doubt that CB's do in fact save monies vs. solid blades.

As time has gone forward, we have become much more efficient with the technology, and it should be noted that we are currently producing 2nd generation CB's. Our rejection rate is way down from this original concept, and process proficiency is way up.

Now many factors will determine the actual percentage of savings (blade size, CB design, premium steel, etc..), but make no doubt, producing blades with CB technology (using premium steels) costs less than making a solid blade.

swedge, yes I am employed at Kai USA.

 

[Knife Outlet]

Contrary to the above post, as I mentioned in earlier threads, there is no doubt that CB's do in fact save monies vs. solid blades.

As time has gone forward, we have become much more efficient with the technology, and it should be noted that we are currently producing 2nd generation CB's. Our rejection rate is way down from this original concept, and process proficiency is way up.

Now many factors will determine the actual percentage of savings (blade size, CB design, premium steel, etc..), but make no doubt, producing blades with CB technology (using premium steels) costs less than making a solid blade.

swedge, yes I am employed at Kai USA.

That is really hard to imagine. The materials used in making most knives are a small part of the price - very small. To imagine that the difference in cost between two fairly common steels used in the spine of a blade is enough to overcome the cost of labor and machinery to cut a composite blade doesn't add up for me. I would think the cost of operating the CNC laser cutter or whatever you use would be greater than the difference in the cost of spine steel. I would think the factory floor time alone would be greater than the difference in steel cost. The time spent grinding steel alone is normally more costly than the steel itself in making a production knife - if not in China then certainly in the U.S. Making a composite blade doesn't eliminate the need for grinding and applying an edge. Have you calculated and included the amortization cost of the equipment? Sorry, you can tell I'm a bit incredulous.

 

[SPXTrader]

Contrary to the above post, as I mentioned in earlier threads, there is no doubt that CB's do in fact save monies vs. solid blades.

As time has gone forward, we have become much more efficient with the technology, and it should be noted that we are currently producing 2nd generation CB's. Our rejection rate is way down from this original concept, and process proficiency is way up.

Now many factors will determine the actual percentage of savings (blade size, CB design, premium steel, etc..), but make no doubt, producing blades with CB technology (using premium steels) costs less than making a solid blade.

swedge, yes I am employed at Kai USA.

That is really hard to imagine. The materials used in making most knives are a small part of the price - very small. To imagine that the difference in cost between two fairly common steels used in the spine of a blade is enough to overcome the cost of labor and machinery to cut a composite blade doesn't add up for me. I would think the cost of operating the CNC laser cutter or whatever you use would be greater than the difference in the cost of spine steel. I would think the factory floor time alone would be greater than the difference in steel cost. The time spent grinding steel alone is normally more costly than the steel itself in making a production knife - if not in China then certainly in the U.S. Making a composite blade doesn't eliminate the need for grinding and applying an edge. Have you calculated and included the amortization cost of the equipment? Sorry, you can tell I'm a bit incredulous.

I really have a hard time understanding why people continue to question Kershaw's National Sales Manager.

If he has any agenda here, it is to provide accurate information on their operations. Would you expect any major manufacturer to try to hood-wink the members here?

 

[kneedeep]

I don't have my Spyderco or Kershaw catalogs handy, but the MSRP's of differently bladed variations of the same knife ought to give us a reasonable idea of the answer to the OP's question.

The Sandvik, ZDP, and S110V Shallots should be a good place to start since the materials are basically the same other than the blades.

 

[3Guardsmen]

I really have a hard time understanding why people continue to question Kershaw's National Sales Manager.

If he has any agenda here, it is to provide accurate information on their operations.

I don't doubt what what Thomas is saying, but it does seem rather incredible (and fantastic) that the whole CB process could be less costly than using a solid blade of the same, premium steel.

Would you expect any major manufacturer to try to hood-wink the members here?

I would never expect Thomas to, but do not think for a second that it hasn't been done by others, here on these very forums, as it most certainly has.

Regards,
3G

 

[SPXTrader]

3G, I had first used the word "credible" in my last statement you quoted. But after consideration, changed the word to "major". Less inflaminatory.

I do know there have been others here that have tried to pull one over on the members here. And they were correctly outed, and the facts still remain in the heads of some.

Maybe I should have stayed with the term "credible"!

 

[Thomas W]

The materials used in making most knives are a small part of the price - very small.

Direct material/component costs on average make up 60%+ of our knives. Not exactly "very small" in my eyes. Direct labor follows, and factory overhead picks up the balance.

To imagine that the difference in cost between two fairly common steels used in the spine of a blade is enough to overcome the cost of labor and machinery to cut a composite blade doesn't add up for me. I would think the cost of operating the CNC laser cutter or whatever you use would be greater than the difference in the cost of spine steel.

I'm a little lost with the "two fairly common steels used in the spine", but I'll try to answer this the best I can.

We're talking about premium steels here, so whether you are using a solid blade or CB, you're off to the laser. So there is no distinct advantage factory floor wise for the solid blade.

Does that answer and make sense to this part of your post?

I would think the factory floor time alone would be greater than the difference in steel cost.

Labor is expensive, no doubt, but as I said above, materials/components exceed the labor on both fronts.

The time spent grinding steel alone is normally more costly than the steel itself in making a production knife - if not in China then certainly in the U.S.

Unless I'm not understanding, it seems this is the third time you have stated this, so... the steel/components add up to 60%+ of the cost of our knives.

Maybe it's different at other factories?

Have you calculated and included the amortization cost of the equipment?

From direct materials, to scrap, to re-work/production support, both machine and property depreciation, even threw in property tax's, insurance, and utilities for good measure.

Sorry, you can tell I'm a bit incredulous.

I'm unsure if I can convince you, and don't like throwing out the "Trust me" card, so I'll just hang with my answers.

 

[Knife Outlet]

I appreciate it, Thomas. I've always been told by knife manufacturers that materials represent about 10% of cost and often less for U.S. made products. From that I will take it that Kershaw is far more efficient than most U.S. knife manufacturers. It doesn't surprise me since I consider it one of the best managed companies in the industry. I'm truly surprised by what you said but I have no reason not to trust you or believe you. Thanks for the information and I will gladly step back from my earlier comments.

 

[Thomas W]

I appreciate it, Thomas. I've always been told by knife manufacturers that materials represent about 10% of cost and often less for U.S. made products. From that I will take it that Kershaw is far more efficient than most U.S. knife manufacturers. It doesn't surprise me since I consider it one of the best managed companies in the industry. I'm truly surprised by what you said but I have no reason not to trust you or believe you. Thanks for the information and I will gladly step back from my earlier comments.

I never felt you were not trusting or believing me, as it sounded to me like your common sense meter was going off, and you were simply just questioning my words. Obviously no issues with that.

I'm still unsure if you're convinced, but I appreciate you taking me for my word, and for your kind description concerning our organization. I'm unsure if we're far more efficient than others, but IMO we do pretty good for an organization making blades here in this great country of ours. I will say, that is not easy task as of today.

 

[Swedge]

Direct material/component costs on average make up 60%+ of our knives.

I know of a contract electronics mfr., and direct material/component costs make up more than 60%+ of the selling price. They build to their customer's spec so they have very little in design costs, strictly mfg. Different business, of course, but not so surprising to me that labor is not as big a cost factor as some might think.

Thomas W, thanks for sharing that info with us.

 

[orthogonal1]

Playing the Devil's Advocate - I deal with lawyers regularly, it rubs off - one can honestly say that something costs less if the difference is as little as one (1) cent.

 

[Swedge]

Playing the Devil's Advocate - I deal with lawyers regularly, it rubs off - one can honestly say that something costs less if the difference is as little as one (1) cent.

Yes, one can honestly say that. But in the other thread that kneedeep linked to, Thomas W said when referring to the a 14C/ZDP combo Shallot (and he may have been referring to the retail price):

Minimal savings yes (10%), but a savings none the less.

Very few businesses would pass up a 10% savings.

 

[orthogonal1]

Very few businesses would pass up a 10% savings.

10% of msrp isn't much, once you account for all the markups prior to that. 10% street price comes to even less, of course.

I have no issue with the cost being for all practical purposes equivalent. But for savings of less than a buck or two, which I consider of little import, I don't expect people to act like they are getting some great deal.

Take it for what it is.

Personally, I like Noz's idea: a full ti knife, with a ti/"premium steel" blade.

 

[Knife Outlet]

I never felt you were not trusting or believing me, as it sounded to me like your common sense meter was going off, and you were simply just questioning my words. Obviously no issues with that.

I'm still unsure if you're convinced, but I appreciate you taking me for my word, and for your kind description concerning our organization. I'm unsure if we're far more efficient than others, but IMO we do pretty good for an organization making blades here in this great country of ours. I will say, that is not easy task as of today.

No, I'm convinced. Surprised but convinced. Obviously you know a whole lot more about the operation than I do.

 

[SPXTrader]

Playing the Devil's Advocate - I deal with lawyers regularly, it rubs off - .

Things are suddenly becoming a lot clearer!

And I hear Moe's has Devil's Advocate in his bar. Homer play it quite often.

 

[Thomas W]

10% of msrp isn't much, once you account for all the markups prior to that. 10% street price comes to even less, of course.

I have no issue with the cost being for all practical purposes equivalent. But for savings of less than a buck or two, which I consider of little import, I don't expect people to act like they are getting some great deal.

First time I've seen savings minimalized.

Well if you take the Tyrade, and let's say we saved you 10% by going CB with it, that would fetch you a free bottle of decent scotch. In my book that's a great deal.

See, CB's can be your friend. It's all in one's perspective I guess.