There is a common myth among the manufacturers that automation includes high acquisition costs. Therefore, they entirely overlook all of its benefits. The question that is somewhat stuck with them is – How can automation derive sustained profitability? And the best available answer to this question is the ROI (or Return on Investment). Studies have proven that a manufacturer sees an average ROI within 24 months from automation.
When determining the true ROI, it is important to consider business costs, higher profit potential, and the robot costs so as to achieve accurate calculations. Moreover, it is also necessary to break down the total costs into further subcategories like Cost of Acquisition, Cost of Installation, Cost of Maintenance, Cost of Operating, Cost Related to Training, etc.
Business Costs and Robot Cost: There are many costs related to human operators only. Hiring and retaining skilled workers is a very challenging task and replacing your existing workforce can be much expensive. Even when you successfully hire new workers, training them so that they can responsibly handle the skill-demanding activities requires additional costs. Plus, your productivity will also take a heavy toll. Additionally, providing various benefits to your workers so as to keep them motivated and committed towards their work is also a hefty expense in itself. Costs related to their life insurance, paid time offs, etc., sometimes add up significantly when compared to their actual wages.
Another significant cost that no one talks about is that of safety. No manufacturer can deny the fact that the workplace accidents can occur anytime and there are many costs involved in the installation of safety equipment + gear in your unit. And we are not even talking about the settlement expense in case of any serious accidents.
If we compare all these expenses related to the human workforce with that of an automated robot, there are, literally, no such additional costs involved. Hence, it is important to consider these factors as well while determining the ROI.
Higher Profit Potential: This comprises of certain factors:
No doubt, ROI can be calculated by a simple formula of (Gain – Investment)/Investment, but there is actually more to it. And, it is important to consider all the above factors while making any calculations.
The present trend in the industry is witnessing a significant rise in manufacturing units adopting automation and it surely is the perfect time for all the manufacturing units, whether small or large, to mould its processes accordingly. Else, their competitors will easily surpass them and their survival in today’s cut-throat Industry 4.0 competition can be close to impossible.
Marshall Machine has made enormous efforts in R&D, accompanied by 12 patents in cutting edge technologies, and has been successful in providing Super-Optimised Machines and Affordable Automation so that even SMEs, with very limited resources, can also implement Industry 4.0 in their production without risking their survival.