Tooling and mould costs: who owns the tool?

Paid outright. You pay the tool cost as a separate line, and the tool exists as a thing you have bought. It is the cleanest arrangement, it is the most expensive at the start, and it is the only one where "who owns it" has an obvious answer — provided the invoice and the contract actually say the tool is being sold to you rather than that a tooling SERVICE is being provided.

Amortised into the unit price. The factory carries the tool cost and recovers it across an agreed quantity, so the unit price is higher until it is paid off. Perfectly normal, and it has a sharp edge: until the agreed quantity is reached, the factory has a real economic claim on the tool, and leaving early usually triggers a balance you did not budget for. Write the schedule down — how much is being recovered per unit, over what quantity, and what is owed if you stop at any point.

"Free tooling". The factory waives the charge in exchange for the order. Nothing is free: you are paying for the tool inside the unit price, on a schedule nobody wrote down, for as long as you keep buying. And it almost always comes with the tool being the factory's, which is the point of the offer — it is the cheapest lock-in available to them and it is bought with money that never appears as a line item.

Whichever it is, insist that the arrangement is stated as a sentence about OWNERSHIP rather than as a price. "Tooling: paid" says nothing. "The buyer purchases the tool identified as X; title passes on payment; the tool is held by the supplier as bailee" says the thing that matters.

And a tooling charge is not one tool. A product usually needs several — a mould per part, plus fixtures, jigs and test rigs — and a "tooling cost" agreed as a lump often turns out to cover the main mould only. Ask for the list, item by item, before you agree the number.

Ownership is necessary and it is not sufficient. A clause saying the tool is yours is worth having and it is not control: to act on it you would have to enforce a contract, in another jurisdiction, against a party that is physically holding a heavy object inside their own building — while your production is stopped. That is a negotiating position, not a remedy, and it is why the practical work is in the arrangements that make the clause unnecessary.

Say where the tool lives and on what basis. The normal, workable arrangement is that the supplier holds YOUR tool for you and uses it only for your orders — so name it: the tool is the buyer's property, held by the supplier, used only to produce the buyer's goods, returned or released on request. A tool held on those terms is a different legal object from a tool the supplier owns, even when it is on the same shelf.

Mark it and record it. A tool number, a photograph, the dimensions and weight, the machine it runs on, and where it is stored. Mould stores contain dozens of near-identical steel blocks; a tool nobody can identify is a tool nobody can collect, and "we cannot find it" is a much easier answer for a factory to give than "we will not release it".

Then remove the reason to argue. Have the tool released, or its status confirmed in writing with a photograph, at defined points — after the first production run, and at least annually. A confirmation you never asked for during three good years is a confirmation nobody will give you in the first bad week.

One consequence people miss: if you supplied the tool free of charge to the factory, its value can be added to the customs value of the goods it produces, under the same valuation rules that govern the rest of your entry — even though it never appears on the goods invoice. That is arithmetic rather than a penalty, and it is worth knowing before it appears in an audit.

Steel wears. Every cycle abrades the surfaces slightly, the shut-off faces lose their seal, texture polishes out, and sliding components loosen. The first visible symptom is usually flash — a thin ragged fin of material along the parting line — followed by dimensions drifting and finish going dull. None of it is dramatic and all of it is gradual, which is why it is normally noticed by a customer rather than by the factory.

No life figure is published here, and the reason is that the honest answer is a range spanning more than an order of magnitude: it depends on the steel and its hardness, the resin and whether it is filled with anything abrasive, the part geometry, the tolerances you need and — most of all — whether the tool is maintained. A published number would be treated as a warranty by one party and a target by the other, and both readings are wrong.

So agree the maintenance, not just the ownership. Who cleans and services the tool, at what interval, who pays, and who holds the record. A tool that is polished, greased and stored properly between runs lasts a multiple of one that is left in a rack with the last shot still in the cavity.

Agree the wear parts too. Ejector pins, springs, slides, gates and inserts are expected to be replaced during a tool's life, and replacing them is maintenance rather than a new tool. The argument that costs money is the one where "the tool is worn out" arrives as a demand for a new tool cost, without any record of the maintenance that should have preceded it.

And build a bridge to the end: agree in advance what happens when the tool genuinely reaches the end of its life. Who pays for the replacement, on what basis, and whether the original ownership terms carry across to the new steel. It is a five-minute conversation at the start and a stand-off later.

This is the question nobody asks and the one that decides whether ownership was worth anything. A mould is built for a machine: a clamping tonnage, a shot size, a platen and tie-bar spacing, an ejector pattern, a cooling and hydraulic arrangement. A tool that runs beautifully on one press may need modification, an adapter plate or a different machine entirely at the next factory — and sometimes the modification is not economic.

Then the trials. A moved tool is re-trialled at the new factory, and the parts that come off it first are not the parts you were getting. Process settings are specific to the machine, the material lot and the ambient conditions, and re-establishing them takes time and scrap. Budget the transfer as a project with a schedule, not as a courier booking.

And nobody warrants somebody else's steel. A new factory will decline responsibility for a tool they did not build, will often want to inspect and refurbish it at your cost before running it, and will be entitled to. That is not obstruction — a tool they cannot vouch for is a quality risk they cannot price — but it means the real cost of moving is the refurbishment plus the trials plus the lost weeks, and the tool cost you were protecting may turn out to be the smaller number.

Which reframes the decision. If your product will run for years and the tool is genuinely portable, own it and keep it maintained. If the tool is deeply matched to one factory's equipment, the honest question is whether a SECOND tool at a new supplier is cheaper than moving the first — and quite often it is, once the trials and the refurbishment are counted.

The one thing that is always worth owning outright, and costs nothing to secure: the design data. The 3D model, the 2D drawings with tolerances, the material specification and the artwork files. A tool is a way of making the part; the data is the part. A buyer holding current design data can have a new tool cut anywhere, and a buyer without it is dependent no matter what the tooling clause says.