When adding new or used tissue converting equipment to your line, the cost of doing so doesn’t begin and end with the machine’s purchase price.
There are a number of considerations that impact the total cost of ownership, and all must be accounted for in order to truly understand the commitment you are making in the short and long term.
1. Production Output and Financing
Managing the bottom line often means weighing how you finance the tissue converting equipment. For machinery intended to be used for its entire lifespan, an outright purchase may let you take advantage of favorable interest rates and loan terms.
However, if cash flow doesn’t allow for a purchase or if the equipment will be used for a prescribed period of time, leasing could be a viable solution. It can lower payments, give you time to evaluate the equipment’s effectiveness before a potential buy, and allow you an “out” for walking away from the commitment. These benefits come at a cost, though, as leasing is generally a little more expensive than owning equipment over the long term.
Finally, pay-per-use is an opportunity to use equipment for a specific project without having to purchase it. Pay-per-use allows you to produce with zero startup capital and pay based on the amount of product you produce for a mutually agreed amount of time.
2. OEM Reputation
The tissue converting equipment you decide upon is only part of the cost. If you ignore what the manufacturer brings to the table in terms of value-add — accessibility, local engineering and technical service, readily available spare parts, and operations resources — you could be putting yourself at a disadvantage. A manufacturer known for truly partnering with its customers is going to be there when you need them most, like when a machine malfunction threatens to shut down your line and/or extremely diminish productivity.
3. Operational/Environmental Efficiencies and Equipment Flexibility
Like other types of machinery, tissue converting equipment requires varying levels of power to operate. Energy consumption has a direct impact on ancillary utility costs as well as a certain amount of environmental impact. While energy efficient models are becoming the norm, it’s important to understand how certain characteristics like motor construction, peak performance time frames or heat emission add to or detract from overall operational and environmental efficiencies — and potentially your bottom line.
And speaking of the bottom line, you also need to consider whether the machine you’re considering includes technology that provides a wide operating window that can help drive down the fiber cost per roll. The equipment ought to facilitate long-term product development cycles — including product desheeting, which takes place approximately every 2–3 years — while also providing flexibility to use different raw materials in light of fiber cost fluctuations.
4. Installation (In-house-managed vs. Turnkey)
How long will it take to install the equipment? Does the footprint fit into current allotted floor space? Do additional materials need to be purchased for successful installation? Does the manufacturer provide labor, or is it an added cost? These questions are critical, and can easily be overlooked. Take the time to get clarity around how installation will impact your operation on the whole to avoid add-on costs that may not have been fully considered in the initial purchase.
5. Operator Training, Performance and Safety
Along with physical installation of the tissue converting equipment comes operator training, performance and safety. It is imperative that workers have the time to familiarize themselves with the equipment, get trained properly and understand how to stay safe during operation. Investing the time to bring operators up to speed is only one added cost. Learning curves also mean mistakes, downtime and a temporary drop in productivity that increase expenses in materials and output.
Adding tissue converting equipment can maximize production while simultaneously keeping line expenses in check, as long as a realistic approach to the true cost of the addition is factored into the spend. Fabio Perini North America can help you with all aspects of updating or expanding your tissue converting line. Click the button below to access our Equipment Showcase, and check out the solutions we’re ready to provide.