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How a more efficient injection molding process can

impact your bottom line
NOTE: Were using injection molding in the example below. However the exact same
principles apply to any plastics process (extrusion, blow molding, etc. If youd like to see
an example for your plant, just let us know.
Our injection molding ROI App can help you make these calculations easily. You
can download the app here or use it right on our website here.
Suppose your company has 10 injection molding machines and needs to increase
production capacity by 10%. Assume you can either buy one more machine or you can
improve the efficiency of each of your present machines by 10%.
Which would be a better decision?

Option 1 Buy a New Machine

Capital investment in a new molding machine

= $100,000

Yearly value of the products produced per year/machine

= $300,000/yr

Companys average before tax profit margin

Total profit by purchasing a new machine

= 8%
= $24,000/yr

Summary: The new machine gives the company the 10% increase in output it was
looking for and provides a $24,000 ROI before taxes.

Option 2 Improve the Efficiency of Existing

Machines by 10%.
Using proven injection molding training programs, the company improves the output of
each machine by 10% instead of buying that new injection molding machine. What is the
result?
A 10% increase in output is worth the same whether it comes from one new machine or
10 existing machines. So, in this example, the additional output is still worth $300,000,
but the profit margin on this last $300,000 of output is more than 10%. Why? Because
the only major increase in costs is the cost of the plastic about 35% of the sales dollar.
There may also be added costs for supplies and electricity, etc. But these costs average
only about 5% of the sales dollar.

Yearly value of increased output

= $300,000/yr

Costs
Plastic 35% of sales dollar

= $105,000

Added electricity and supplies (5%)

Total added costs
Added Profit (each year)

= $15,000
= $120,000
= $180,000

The decision is a no-brainer. Increasing injection molding efficiency by 10% is 7 times

more profitable than buying 10% more production capacity in the form of a new injection
molding machine.
So can your company improve productivity by 10% using your existing workforce but
having them much better trained? Injection molding are doing it every day.
(A measly 1% profit increase from training will pay for the total cost of the training
in just 1 year, but we would be too embarrassed to sell you a training program if
we thought thats all youd get.)

Conclusion:
A well-trained injection molding production floor workforce will keep you profitable in good
times or bad.
Additional benefits:

lower reject rates

faster mold startup times

less wasted plastic

A skilled employee ready to step in when the inevitable turnover happens

And most importantly, training now will get you ready for the next economic
upturn.