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 of roll, fold, and packaging equipment. Whether you are an established operation or a tissue converting startup, these five factors must be accounted for to truly understand the short- and long-term financial commitments you are making.
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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 prohibits a purchase or if equipment use is temporary, leasing could be a viable solution. Leasing can lower payments, give you time to evaluate the equipment’s effectiveness prior to purchase, 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 long-term equipment ownership.
Finally, pay-per-use is an opportunity to use equipment for a specific project without having to purchase it. Pay-per-use requires zero startup capital as you pay based on the amount of product you produce for a mutually agreed amount of time.
2. Equipment OEM reputation
The tissue converting equipment you decide upon is only part of the cost. If you ignore what the equipment 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 true manufacturing partner is going to be there when you need them most, like when a machine malfunction diminishes productivity or supply chain issues threaten to shut down your line.
3. Operational/environmental efficiencies and equipment flexibility
Like other types of machinery, tissue converting equipment requires varying levels of power to operate. Energy consumption directly ties to utility costs and also has ancillary environmental consequences.
While energy-efficient models are becoming the norm, it’s still important to understand how certain equipment characteristics add to or detract from overall operational efficiencies and environmental impact. Things like motor construction, peak performance time frames, or heat emission can quickly decrease your bottom line.
Speaking of the bottom line, you also need to consider whether prospective machinery includes technology with a wide operating window to help drive down per-roll fiber cost. Further, the equipment ought to facilitate long-term product development cycles (including product desheeting every 2–3 years) and provide 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 imperatives around training, performance, and safety. Investing the time to bring operators up to speed is essential, but it only accounts for one added cost. Learning curves also mean mistakes, unanticipated downtime, and temporary drops in productivity that increase expenses in materials and output.
Adding tissue converting equipment can help maximize production and manage expenses, but you must remain realistic about factoring true costs into the spend. Whether you’re a startup in the throes of business planning or a growing operation, Körber 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 that are ready for immediate delivery.
Written by Claudio J Muñoz
An experienced executive in the Tissue and Pulp & Paper Industry, with wide-ranging global experience in brand management, marketing, engineering, product and process development initiatives, Claudio Muñoz brings a unique blend of innovation and strategic insight to his role as Senior Global Director of Strategic Marketing and Head of Marketing - Americas for Körber Business Area Tissue. He holds a bachelor's in Chemical Engineering from Universidad de Concepcion, Chile, and master's degrees from the University of Guadalajara, Mexico, and the University of Wisconsin - Madison.
