If you have spoken to a responsible industrial automation integrator, they have been upfront with you about costs for a responsibly scoped automation integration commonly reaching well into six or seven figures. With a six-figure capital expenditure, and calculated return on investment taking months or years, we understand justifying upfront costs. With a changing market, increasing demand for manufacturing, and a manufacturing labor shortage, you must stay competitive. We would like to spotlight the many ways industrial automation lowers costs, increases profits, and reduces overhead.
A recent study published in Industry Today revealed that the average time a position stays open is forty-two days, with a range of twelve days to two months. That means every time a worker leaves your production, your production is below efficiency for more than a month. It is estimated that every time you replace an employee the cost to your business between searching, interviews, and training is on average 20% of that employee’s yearly salary. With the average manufacturing employee currently lasting 12 to 18 months (about 1 and a half years), your business eats these costs on repeat. The average lifespan of a properly maintained and scoped industrial machine operating at maximum capacity, twenty-four hours a day, is twenty years. Look at the number of manufacturing employees you have had to replace this year and add up all the twenty percents from yearly salaries and see how this one metric starts comparing to the cost of the automation. And if you are concerned about the optics of replacing your workforce, you do not have to. The jobs an automated machine does with the highest return are also the highest turnover positions. Offloading these repetitive, dangerous, unsatisfying jobs improves the work environment, raises job satisfaction levels, and boosts retention.
The National Safety Council published that work injury costs per worker amounted to $1,100, but as much as $44,000 for medically consulted injuries through wage loses, medical expenses, administrative expenses, and employer costs in 2020. An average of 11 workdays per year per person are lost to injury. Assembly Magazine calculated that the top five types of workplace injuries included contact with harmful objects (40%), overexertion (24%), slips and falls (19%), repetitive motion (8%), and contact with harmful substances and chemicals (6%). An automated machine can perform tasks with heavy lifting or stress, repetitive motion, contact with harmful chemicals and hazards, and dangerous objects. With an automated machine you have not only improved your workers’ environment, but you have also reduced your safety costs by 78%.
A properly maintained automated machine can work 24 hours a day. It does not need breaks, vacations, or sick days. It does not get distracted fifteen minutes before closing and does not care if the work is repetitive or boring. One fast Pick and Place robot can cycle 150 times in one minute. You can take a job that requires a full team of workers to run and offload it to one machine.
Another company cannot poach your machine. Your machine does not have seniority or the ability to quit. Your machine will not negotiate for raises or benefits. Your machine will not retire, pursue another career, or request part time. With one fifth of the population retiring in 2029, you must ask yourself now whether you have a plan for when some of those worker skills are not even taught in technical schools anymore. You can plan your long-term production strategy more easily with an automated machine.
OSHA (Occupational Safety and Health Administration) requirements for PPE mean reusable and disposable costs must be absorbed by the company. Depending on the quality, repetition, and function of your tools, manual tools must be replaced. Automated machines wear at a much lower rate and do not require PPE.
An automated machine has industry supported advantages on high accuracy, increased quality, and consistent output than manual workers. This does not just lower the costs associated with flawed products, it decreases the chances for violations of standards or regulations.
3PL News reported that automated facilities require 40% less floor space than manual labor driven production spaces. That 40% gives you the option to either decrease your footprint or to dedicate that space to additional business, production, or machines. Less floor space means more room to scale your business.
A responsible automation integrator will not just bolt the machine to the floor. Your automation integration will include process improvements that add to the efficiency of your production and add to your bottom line. There are numerous opportunities to improve processes, take on neglected projects, and make use of your manufacturing floor once you have concentrated your production capacity with a machine. Your integrator can help you streamline your custom machine toward the 80/20 applications most suitable for swift return on investment. Be prepared for a quality integrator to ask for growth expectations beyond the throughput numbers. Be ready to verbalize how your team will work with the machine, whether you could reduce your process to a single shift with a minor change, and what is up and downstream from your production process. You get an expert outsider’s professional perspective on your process.
Without changing the size of your workforce, you can increase your speed, safety, work environment, speed, consistency, quality, and throughput. Even though the return on investment may be months or years off, these enhanced abilities are available the second the machine is integrated into your production. ROI is a justification for the capital investment, a proof of concept that with today’s production capacity you can recover the investment costs in a timely manner. In reality, your business can pursue customers that could not be pursued before because of capacity, you can pursue more customers, the workers displaced by the machine can be reskilled as operators or directed towards more innovative and creative work. An automated machine might need time to return on the investment, but once that return is achieved, it is all profit. ROI is a fraction of the life of your machine.
We are Experts at Mitigating the Risks of Capital Investment
At DEVELOP LLC we do not trivialize the costs associated with automation integration. Our Automation Assessments target the specifics of your business, ratios every advantage, and exploits every opportunity to return on your investment. Our skilled team of software engineers, project managers, and efficiency experts have years of experience educating our customers beyond our competitors for growth, profit, and self-reliability. Tell us more about your project, schedule a virtual meeting, or call (262)-622-6104 to learn more about how we can chart a course for financial impregnability with an industrial automated solution. Try our downloadable ROI calculator to estimate the return on investment, now with a reverse ROI tool to help you estimate what your budget based on how swiftly you want your return on investment.