By industry
Thirty two percent gross margin, sixty two percent of your cost bought in from somebody else, customers on fourteen month contracts and competitors who take four months to react and then match more than half your move. Those are the starting points a manufacturing twin uses before it has read a line of yours.
Every number on this page is a default. The first document you upload that contradicts one replaces it.
A thin margin with a high elasticity is the hardest combination in the table.
At thirty two percent gross margin, losing volume hurts fast, and at an elasticity of 1.8, a price move produces plenty of it. But sixty two percent of your cost comes from suppliers, so a cost rise you cannot pass on hurts just as fast in the other direction. Manufacturing twins spend most of their time in the space between those two facts.
| Starting point | Default | What it drives in a run |
|---|---|---|
| Gross margin | 32 percent | How much a lost unit actually costs you, and how quickly a supplier rise eats the year. |
| Monthly customer churn | 1.2 percent | About thirteen and a half percent of accounts in a year if nothing changes. Industrial relationships are sticky. |
| Price elasticity of demand | 1.8 | A ten percent rise is modelled as roughly eighteen percent less volume before contracts, switching costs and segments are applied. |
| Revenue under contract | 55 percent | Just over half your book cannot respond to a price change this month, which delays and then concentrates the effect. |
| Average months left on contract | 14 | The long tail. A decision taken in January is still arriving at customers the following March. |
| Share of cost from suppliers | 62 percent | The single largest line. This is why supplier scenarios dominate manufacturing twins. |
| How hard competitors match a move | 0.55 | They follow with just over half of whatever you did, once. |
| Months before competitors react | 4 | Slow, because they have their own contracts and their own tooling. Four months of clear air, then the match. |
| Revenue a head can serve per month | 21,000 dollars | Capacity. Cross it and delivery degrades before revenue does. |
| Cost to a customer of switching | 0.60 | Qualification, tooling and audit. High, which is what makes the first price rise survivable. |
| Monthly market growth | 0.3 percent | About 3.7 percent a year. Growth comes from share, not from the tide. |
| Monthly cost per head | 6,400 dollars | Fully loaded. Drives the cost case on any headcount scenario. |
| Regulatory exposure | 0.45 | Moderate. Enough that a large price move by a company with real share can attract attention. |
Thirteen defaults, all replaceable, all drawn with a band on every replication. Gross margin draws within fifteen percent of its value, churn within thirty five, elasticity within forty, monthly market growth within fifty. The cost to win a customer starts at nine months of that customer's revenue.
The shape of the question
Manufacturing questions arrive in three shapes. The first is a cost shock moving up the chain: a supplier raises, a material moves, freight changes, and the whole question is how much of it you can pass on before the elasticity of 1.8 takes the volume back.
The second is concentration. Long contracts and high switching costs produce a book where a handful of accounts carry the business, and the honest version of the question is what one non renewal does to a cost base that does not move on the same date.
The third is footprint: a line moved, a site consolidated, a second source qualified. These have a transition period where you pay for both, a quality dip customers can feel, and a lead time that gets worse before it gets better.
Uploads
In order of how much band they remove.
With sixty two percent of cost bought in, this is the highest value upload in the industry. It replaces supplier cost share, supplier concentration and lead time, and it is the difference between a generic supplier scenario and yours.
Replaces revenue under contract and average months remaining. Those two decide when any decision reaches your customers, so getting them wrong shifts the whole path by a quarter.
Replaces churn, revenue per customer, largest customer share and top five share, and turns your named accounts into individual agents rather than a segment average.
Replaces gross margin, cost per head and monthly operating cost with quoted lines, and narrows their bands because a stated figure is treated as tighter than a default.
Honestly
Capacity is a single number: revenue a head can serve per month, starting at 21,000 dollars. That is a poor description of a factory. There is no bill of materials, no routing, no machine, no changeover, no shift pattern and no work in progress. If your question is about a bottleneck between two cells, or the effect of a changeover regime, this model cannot see it and a discrete event simulation can.
Inventory is not modelled as a buffer. Real manufacturers absorb months of disruption with stock, and a twin that does not carry it will make a supply shock look sharper and earlier than it will feel. Read the timing on a supply scenario as the shape of the event rather than the date of it.
The engine runs monthly, so anything that resolves inside four weeks is invisible. A two week outage, an expedited shipment, a short tooling failure: none of these have anywhere to live in the run.
And pass through starts as a single assumption applied across the book. In reality it differs by account and by contract clause. If your contracts have indexation terms, upload them, because that is the one thing that would materially change a supplier scenario.
Start here
Sixty two percent cost share means this lands hard and lands in month one. Then the pass through decision, then the volume answer to the pass through.
Supplier raises pricesBoth sites running, a quality dip, lead times stretching, and the unit cost that made the case in the first place, all in one twelve month path.
Move manufacturingFourteen month contracts and a 0.60 switching cost make this rare and expensive. Rare events are exactly what a distribution is for.
Lose the largest customerWith sixty two percent of cost bought in, the purchasing file is worth more to a manufacturing twin than anything else you could upload. The worked example, an invented contract manufacturer single sourced on a marine grade billet, is set up to show why.