While the costs associated with packaging automation may seem daunting, you may be surprised by how quickly machines can eventually pay for themselves, and then some. With the right strategies in place, an automated packaging process can have a big impact on your financials.
Whether you’re in the early stages of your product manufacturing company or you’ve been in business for many years, there are many key areas in which automation and can reduce your costs.
Greater Production Volume and Consistency
A strategic automated packaging process can expedite your production by a factor of days – We’re not talking mere hours of efficiency. Depending on your current production, you may be able to produce days’ worth of additional volume in the time you save with automation. Your labor force can only do so much on their own, even at peak efficiency. But with shorter production time, you’re able to yield more, faster.
Rather than hiring additional staff or paying for overtime to yield higher packaging production, investing in automation helps you more scale more efficiently (and realistically) to produce more packaged products in the same amount of time. Subsequently, reducing your labor costs allows you to take on more customers than before, ultimately boosting your profitability.
Some of those new customers may be significant contracts with volume orders you may not have been able to fill with previous infrastructure and processes. But automation gives you that freedom and ability to turn around a larger product order in a shorter amount of time.
Your increased volume isn’t a matter of production at the cost of consistency either. Thanks to machine precision, automation gives you the power to produce the same or better-quality products on a consistent basis. Your packaging materials and construction will heed a more consistent finished package.
Minimizing Human Error
Although mistakes are a reality of human-led processes, the occurrence of human error is minimized with automated processes. From damaged products to wasted materials, mistakes common in production can be thwarted with a strategic introduction of automation.
Modern machinery has become so advanced that it’s able to verify the material you’re using and deem it effective for the product you’re packaging. This ability minimizes the need for re-wraps and similar mistakes.
Issues with labeling and packaging can damage your brand and relationships in distribution, retail market and others throughout your supply chain. From wasted supplies and materials to repackaging and delays in production and distribution center delivery, there are a slew of problems that may stem from labeling mistakes. Many big-box stores have gone as far as instituting fines for incorrect labeling and scanning. At its worst, these problems can harm the consumer, causing damage to your brand reputation. Thankfully, newer machinery can catch these issues before the product gets out into the field and save you any potential reputation damage.
When weighing the options of manual and automated packaging, many manufacturers suffer from the sticker shock of the upfront cost of machinery. But a sound a investment in automation equipment can significantly lower your variable cost of production and packaging over the its usable life. For many businesses, recouping the initial financial outlay comes quickly.
Compare your investment to the cost of manual labor, which includes overhead costs beyond a simple wage or salary. You may pay social security, workers compensation, unemployment, insurance and more for each employee on your production floor. Machines come with their own supplemental costs, too. There are costs associated with maintenance of automated machinery. But in many cases, these cost are less than that of labor costs.
There’s also the possibility of unexpected employee turnover, which could slow down production and delay the delivery of finished goods to your customer. Automated machinery and robotics won’t leave for a new job or take any vacations, and it won’t call in sick if properly maintained! Rather than adding a position, you can have the opportunity to utilize some of the current packaging line workers in other parts of your production. Depending on your labor cost structure you could save anywhere from $25,000 to $35,000 with the reduced workforce needed on your packaging line.
Cut Back on Energy Consumption
With the introduction of servo motors and all-electric machines, you also have the opportunity eliminate pneumatics, reducing the required energy to create finished packaged goods. The lowered energy savings will reduce your expenses to power your facility and pad your bottom line.
While many managers fear a negative impact on their profits, the expense of packaging automation is one variable in a complex business decision. When you take into account all of the areas in which you can reduce costs, investing in the automation of your packaging line will likely save your business substantially.
Some manufacturers start by automating parts of their packaging processes to minimize their upfront costs. There is no right answer when it comes to which parts of your process to start with, but the areas that are costing you most in productivity, labor and efficiency are a good option. You may also consider identifying the areas which are most prone to errors as a starting point for automation.
Realistically, there are many ways to improve your packaging efficiency and your overall packaging costs. In fact, we’ve outlined some ways to reduce start reducing costs today!
Click below to learn how you can reduce your packing line costs and download a copy of our Packaging Line Cost Savings Infographic.
About David Roberge
Part of the outstanding Industrial Packaging team. I'm lucky to hang out with some of the most knowledgeable folks in the packaging industry. I feel even luckier to be able to share our knowledge with you. I love learning about our readers and helping them grow their brand through unique, flexible package design from the birth of the product idea, through the supply chain, and to the launch and placement on the shelf or at the consumer's door.