In manufacturing terms that means investing in capital equipment. In his article in Gear Technology magazine, Joe Arvin makes the case for the ability to remain competitive.
He points out that manufacturers could get away with investing in capital equipment every twenty years or so, once upon a time: now the necessity to purchase new equipment is more like three to five years.
However, the expense needs to be justified to ensure the technology and equipment you buy will meet your objectives.
So, how do you evaluate the best reinvestment plan?
To emphasise the importance of reinvestment he relates the salutary example of the massive re-build of manufacturing in post war Japan and Germany making them industrial powerhouses. This came at the expense of others in the allied nations who didn’t go through the same root and branch reinvestment and ended up languishing behind or going out of business.
So, having established the critical role of capital expenditure, the article goes on to list a few key points to help you get the most bang for your buck. ‘Since the financial resources for getting everything on your wish list will likely not be available, careful planning and innovation will be essential.’
These points are elaborated in the link below and include:-
- ROI calculations
- Negotiation
- Excess inventory
- Demo units
- Year-end inventory sale
- Machines from trade shows
- The retro fit option
The article also provides a checklist of further considerations such as verifying performance and OEM training; to ensure that your investment is as sound as it can be.
So, advisable to take a read, since in manufacturing the status quo is not an option, click here.