Posted by Alpha Packaging on | Comments Off on Understanding the Total Cost of Ownership in Packaging
What is Total Cost of Ownership (TCO) and Why Does It Matter?
When a business is considering investing in new equipment, one of the most important questions to ask is whether the purchase will deliver a strong return on investment (ROI). The most accurate way to answer that question is to calculate the equipment’s total cost of ownership (TCO). Total cost of ownership is a term used to describe the full long-term expenses associated with acquiring, operating, and maintaining a piece of equipment throughout its lifetime.
With packaging machinery, this means considering ongoing maintenance and repair costs, energy consumption, operator training, and the cost of packaging materials. Understanding the direct and indirect costs associated with new equipment is the best way to predict your ROI and make informed investment decisions.
Why Does TCO Matter in Packaging?
For many businesses, packaging is an unavoidable expense that plays a large role in operational efficiency and revenue generation. Packaging methods directly influence whether or not products ship safely and on time, and also impact labor requirements, operation costs, and much more. Taking the time to calculate the total cost of operating packaging equipment allows businesses to determine which option will be the most economical to run and maintain, helping to maximize profitability and improve competitiveness.
Key Elements of TCO in Packaging
For packaging equipment, finding total cost of ownership involves evaluating three main expense areas: acquisition costs, operational costs, and disposal costs.
Acquisition Costs
Acquisition costs are the most straightforward aspect of calculating TCO. They include the costs associated with purchasing the packaging equipment itself and any related items required for operation. While many businesses assume a machine’s purchase price reflects the total cost of their packaging investment, it’s actually only one part of the true cost of ownership.
Operational Costs
Once acquisition costs are determined, the next step is to evaluate your equipment’s operating costs. These ongoing expenses make up a significant portion of the total cost of ownership and are required to keep your equipment running efficiently. For example, common operational costs include:
Energy costs. The price of electricity used to run your equipment.
Maintenance and repairs. All machinery requires ongoing preventative maintenance to keep it running at its best. Certain components may also need to be replaced or repaired throughout the equipment’s lifetime. Systems like Lantech packaging machinery are designed for long-term reliability to minimize these specific costs.
Training and payroll expenses. Consider whether you’ll need to hire additional staff to run your new equipment and factor in the time and resources you’ll need for training.
In addition to the expenses previously mentioned, you should also consider the efficiency of your packaging processes. Inefficient packaging methods slow down your output, increasing payroll expenses. Taking the time to consider indirect costs like these will help you find ways to improve the efficiency and profitability of your operations. Since operational costs vary widely depending on the equipment involved, your production volume, and other factors, the calculation requires careful consideration.
Disposal Costs
One often overlooked aspect of TCO is disposal costs. Over time, all machinery loses value and functionality. When your equipment reaches the end of its lifespan, you will be responsible for its disposal and any associated expenses. You’ll need to review the regulations in place for your industry to determine how your equipment can be safely disposed of or properly recycled. You can also consider whether or not resale is an option. No matter what disposal method you choose, the unavoidable associated expenses should be factored into your TCO analysis.
Calculating TCO for Packaging
The formula for calculating packaging TCO can be complex because certain parts of the packaging process are consumable. However, you can get a good start by considering basic factors like initial costs, maintenance costs over five years, and the remaining value of the equipment after five years. Begin with the initial cost and then add the expected maintenance costs. From this, subtract the remaining value after deprecation to obtain the total cost of ownership.
Partner with Alpha Packaging
The right packaging equipment can dramatically improve your operation’s efficiency and profitability, but making a smart investment requires a good understanding of the total cost of ownership. As a leader in corrugated box manufacturing solutions, Alpha Packaging delivers custom packaging systems that help companies improve their operations. With over 200 years of combined experience, our experts are here to help you select the right machinery for overcoming industry-specific challenges. Contact us with any questions or request a quote to get started.
Posted by Alpha Packaging on | Comments Off on Packaging Automation Systems & Equipment Explained
Manual packaging systems can create a bottleneck and contribute to high labor costs in your operations. Automated packaging machines are designed to remedy these issues while enhancing packaging consistency. Packaging automation handles case erecting, packing, taping, and labeling more efficiently than manual labor.
At Alpha Packaging, we’ve developed standard and customizable automated packaging solutions that cut down the time and cost of multi-stage packaging processes. Our robust packaging equipment includes 3M case sealing systems, Lantech packaging machinery, crush-resistant Emba by Ultima box folders, and more.
Read on to learn more about these examples of packaging automation systems and the benefits of choosing packaging equipment from Alpha Packaging.
What Are Packaging Automation Systems?
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Packaging automation systems use robotic machinery to complete packaging tasks with minimal human intervention. Automated packaging machines can package individual products in boxes as well as large pallets of goods at a lower cost, with less material waste, and with no risk of human error.
The following automated case erectors, case sealers, stretch film machines, and box-making systems from Alpha Packaging are ideal for retail, food and beverage, and e-commerce industries.
Case Erectors
Automated case erectors can quickly fold and assemble flat cases into boxes. Our semi-automatic and fully automatic case erectors work fast to assemble up to 30 cases per minute without errors.
Case Sealers
Once each box is filled with the necessary goods, our case sealers seal them with the appropriate amount of tape. These machines pair well with case erectors to create a convenient, streamlined process. Our case sealers are easy to operate and require little maintenance.
Stretch Film Machines
Wrapping pallets of sealed cases prepares them for shipping and secure handling. Our stretch film machines quickly wind plastic films around regular and irregularly shaped loads to prevent slippage. We recommend using stretch film machines with pallet grip machines for a fully controlled process.
Automated Box-Making Equipment
Alpha Packaging partners with Emba by Ultima to provide automated box-making equipment. These machines can quickly produce corrugated cardboard boxes from flat cutouts, using a highly replicable process that preserves the geometry and strength of the box. Emba by Ultima machines also reduce material costs by not crushing the corrugated flute during box production.
The Advantages of Crush-Resistant Boxes
Crush-resistant boxes are vital to operations that rely on high stacking during transport or in warehouses. However, many machines on the market crush the corrugated flute during the box-making process, defeating the purpose of the corrugated box. Our Emba by Ultima machines create stronger, crush-resistant boxes without compromising the corrugated flute. As a result, our solution offers packaging lines and box users the following benefits:
Sustainability and Long-Term Impact of Automated Packaging Solutions
Automated machinery helps businesses with long-term sustainability goals. Our box-making and packaging automation systems reduce material waste and last longer. We test all of our boxes through Dynamic Stiffness Testing (DST) and Box Crush Testing (BCT) protocols to guarantee durability and strength. To learn more about the sustainability and cost-saving benefits of automated packaging solutions, including our crush-resistant box-making machines, you can read our guide on how stronger boxes save costs.
Why Alpha’s Packaging Automation Stands Out
Alpha Packaging partners with industry leaders to offer reliable equipment solutions, including innovative box-making machines like our Emba 245 QS Ultima. Our equipment is also cost-effective—your business can quickly recoup the cost of the initial investment by saving on manual labor and material waste. We can also customize automated packaging solutions for your specific needs, whether you are a major manufacturer or a small business. To better understand the financial benefits, read our analysis on understanding the total cost of ownership in packaging.
Cost-Saving Automated Packaging Solutions for Businesses
Automated packaging equipment is a substantial investment, so Alpha Packaging offers a deferred payment plan for businesses to reap the benefits of automation as soon as possible. Rather than paying upfront for the equipment, our clients can pay incrementally by purchasing packaging materials like stretch film and boxes at a slight markup. This allows even small or growing businesses to benefit from the enhanced efficiency and productivity of automation with far less financial strain.
Ready to Automate Your Packaging With Alpha Packaging?
Upgrade your packaging processes today with automated packaging equipment from Alpha Packaging. Choose solutions like Emba by Ultima crush-resistant box-makers, Lantech case erectors, 3M case sealers, and more. Our team will work with you to create custom solutions powered by ArtiosCAD and provide deferred payment options so your organization can reap the benefits of automation without a large upfront payment. Request a quote today to get started.
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