Who charges for PPAP's? Is it common to charge customers for PPAP's?

[Andy1963]

It seems a very strange concept to me to charge specifically for a PPAP. I am assuming those who do also charge separately for a quotation, order processing, invoice raising etc? It should be in your overheads, same as your ISO or TS certification charges are. If you are doing APQP and PPAP properly, then you are avoiding customer complaints and rejections later which are expensive both in terms of processing and customer satisfaction. If you are doing APQP and PPAP as a paper exercise, then you are wasting time and money and perhaps would be better suited to supplying an industry that doesn't require such disciplines. As a customer, I have heard before of suppliers wanting to charge for even inspection reports. I've never quite understood why as a customer I should be expected to pay for a supplier to demonstrate that the part supplied is correct to specification, or that the supplier has the necessary systems and controls in place to continue to supply product that meets specification. Very strange concept that.

 

[Jim Wynne]

It seems a very strange concept to me to charge specifically for a PPAP. I am assuming those who do also charge separately for a quotation, order processing, invoice raising etc? It should be in your overheads, same as your ISO or TS certification charges are. If you are doing APQP and PPAP properly, then you are avoiding customer complaints and rejections later which are expensive both in terms of processing and customer satisfaction. If you are doing APQP and PPAP as a paper exercise, then you are wasting time and money and perhaps would be better suited to supplying an industry that doesn't require such disciplines. As a customer, I have heard before of suppliers wanting to charge for even inspection reports. I've never quite understood why as a customer I should be expected to pay for a supplier to demonstrate that the part supplied is correct to specification, or that the supplier has the necessary systems and controls in place to continue to supply product that meets specification. Very strange concept that.

Welcome to the Cove.

This is a twelve-year-old thread, but it might be more relevant today than it was in 2000. Since then, a lot of non-automotive companies have adopted the PPAP process, or at least a modified version of it. Some of them are ridiculously complicated, and they're being reviewed by people who have no idea what they're looking at for the most part. Many customers are fond of adding onerous requirements by surprise, and sometimes it becomes necessary to use pricing as a deterrent.

I agree that it makes no sense for a company that does automotive business to include PPAP as a line item in a quote, and I don't think it happens very much, if at all. The problem is that even the most conscientious contract review process doesn't always reveal the cards a customer is holding under the table.

 

[TPMB4]

This is an old post so perhaps views have changed a lot since 2000 about activities such as PPAP. I'd have thought a lot of the work that goes into PPAPs are to the benefit of your company as well as the customer so why charge for that? Without a control plan or FMEA you could easily make defective products and that ultimately is a cost to the company. A lot of customers charge for each defect found at their plant so which end do you want to accept the costs at??

Also ISO9001 2008 is a lot more customer focussed as is TS 16949. Would customer satisfaction be met with a charge for PPAP? If you must it could be buried deep in a production run and I bet that is where it is for most suppliers. Either an overhead or a buried charge that is. Either way its a cost for business but could save in the long run even if you do it just for your own company's benefit. FMEA is a worthwhile activity as is the rest to some extent I'd have thought.

 

[Golfman25]

Ok so I am going to resurrect this old post. What is everyone's thinking today, 2017, about PPAP charges?

We make component parts, so pretty simple processes. We have never specifically charged for PPAPs. Typically add it into the upfront cost of tooling and sampling. Some customers will issue a PO for the parts (relatively cheap) so at least I'll get a few dollars.

Here's the thing. These days, most of the PPAP documents you should have anyway such as dimensional layout, process flow, FMEA, and Control plans as a good manufacturer. How else are you controlling production? You should have basic gaging MSAs and such. And cpk studies aren't "too much math" any longer. They only added thing is the PSW, which is a few boxes at most. But I still see people charging for this stuff. What would you do?

 

[jackerman64]

From my experience, most customers will refuse to pay for PPAPs and expect it to be part of doing business with them.
In 25+ years, I've only had 1 supplier charge (or try to charge) for a PPAP and they wanted $600.
I would simply continue to have a hidden buffer to cover it.

 

[hogheavenfarm]

We simply apply an upcharge at the quoting stage unless we get this sprung on us after the fact, in which case we will charge additionally. Most of our items are non automotive, so there is much work that would not normally be done on other parts. I can tell which products may require it and will advise quoting ahead of time.

 

[Golfman25]

We simply apply an upcharge at the quoting stage unless we get this sprung on us after the fact, in which case we will charge additionally. Most of our items are non automotive, so there is much work that would not normally be done on other parts. I can tell which products may require it and will advise quoting ahead of time.

Help me out. From a production PPAP standpoint, what would you not do for non-automotive parts?

 

[hogheavenfarm]

Non automotive does not get the "package" of the msa, fmea, or a full FAI or even matcerts unless specified. Sometimes, I may do this anyway if the part is small and simple, otherwise it simply gets checked to print and scanned into the job file. Sometimes we are not told the function or use of the part, this is when we get hit after the fact. There is an upcharge for going back and filling out all the paperwork. Since these are "run once" parts no paperwork carries over either.