Capital investments generate value when their results are stable and predictable, leading to an overall increase in production and profit. Here is an overview of things to consider when calculating the Return on Investment on these expenditures.
Return on Investment (ROI) is a deciding factor when considering purchasing new equipment for your production line. Why is it the most important factor?
Because not only will it tell you how fast your cleaning system will pay for itself, it will show you how you are actually losing revenue and profits by not purchasing this equipment.
Investing in a cleaning system for your pressroom is a decision to automate a process. Automation brings immediate results: boosted throughput, faster turnaround times, shorter runs, improved quality and a labor savings.
The factors that affect the ROI are generally the same for each converter, but the details will vary depending on the machine.
What Affects the ROI?
There are several factors that affect the calculation of a ROI, most of which boil down to quality control issues. A simple overview evaluation can uncover a lot of issues regarding your production, scheduling and cost operation. Here are a few things to consider when evaluating your production process.
1. Labor expense
Good labor is hard to find, especially labor that is committed to manual cleaning all day. Automating positions formerly done manually by individuals frees those people up to do other more valuable things in your pressroom.
Also, as printing presses modernize, jobs are more complex, runs are shorter and there are more changeovers in a day. How many changeovers you have in a day definitely impacts your cleaning. A backlog of dirty press parts makes changeovers that much harder. At the heart of the pressroom is people, making sure that all of these operations are occurring in line with your production schedule.
How much you spend on labor, and on all the variables that go with labor such as sick days, shortages, human error etc. all contribute to your bottom line.
2. Cost of wasted material
Wasting materials on a project that has to be thrown out does not seem like a big expense, but all of these detract from your earnings in the long run. Materials such as substrate, ink, broken plates, damaged anilox rolls etc. are all elements that do not contribute to the finished product, thereby registering as a loss.
3. Downtime
Downtime is a natural part of the production process for one reason or another. But it is important to notice your downtime, how often it happens and how long it lasts. It is important to note your price per minute production cost — how much it costs for every minute you are down.
The things you cannot measure
The primary result that you cannot measure is an increase in employee morale. Giving your employees the tools they need to succeed and meet goals is a sign of respect. Respecting your employees and letting them have ownership in their success is the best investment a company can make.
Time and time again, converters give the same feedback about their Flexo Wash cleaning systems:
"It is amazing how thankful our guys are to have these tools available to help them do their job more effectively.”
“I cannot imagine running a print facility without one. The efficiency it creates for your press crews, the reduction in make ready times, damaged plates and the appreciation you will get from your team makes it a no brainer.”
"The system has lasted due to our preventative maintenance program and a dedicated group of individuals (operators) who take pride in their work environment and respect the equipment they use.”
What should you do?
Calculating your Return on Investment is a lot more than just plugging numbers into a formula. Each company has specific issues that contribute to their decision. Evaluating your pressroom points of pain related to labor, downtime and material costs will help pinpoint what system is best for you. Most importantly, giving your employees all of the tools they need to meet production goals will increase your profit and revenue stream for years and years to come, long after the machine has paid for itself.
Factory Manager Chris Mountain at Catapult Print has some words of advice for other converters who are wondering if they should invest in a Flexo Wash cleaning system:
“To others considering investing in a Flexo Wash cleaning system, I would fully recommend and ‘go for it!’. This has been one of the best decisions we’ve made regarding machinery and we are very happy with the investment.”