Decisions, decisions, decisions. It can be particularly difficult for a manufacturer to ascertain at what time they should invest in new capital equipment. For example, investing in the proper material unloading system at the right time can make all the difference for up-and-coming manufacturers.
Generally, ingredient purchases in larger volume containers have lower cost/pound than the same ingredients in smaller packages. Larger volume purchases may then require new and larger storage solutions. With automation, larger volumes could also improve efficiency by lowering the total labor required to unload ingredients from their packaging. This may not always be the case in every scenario, but we have put together certain criteria to help dictate if it is indeed the crucial moment to invest in material unloading upgrades in your facility.
Super sacks (also known as big bags or FIBCs)
Essentially, how you purchase material is at the center of this question. 50-pound bags (also known as sacks), 2,000 lb super sacks (also known as big bags) and truckloads (40,000 lbs.) are the three “package sizes” that we will focus on in this article. It is true that every time you make a packing leap to the next size (be it in bags, super sacks or truckloads), you will require new capital equipment to store the larger amounts of material you order.
Typically, a “cost per pound” advantage exists for those purchasing material in larger bulk quantities. You still must ask, “Does this advantage outweigh the cost of the new equipment investments required to store these new amounts of material?” With all of this in mind, what follows are 2 necessary questions to keep in mind when investigating the possibility of larger volume ingredient purchases:
1. How much of your ingredients are you actually using in a given time frame?
A material consumption inventory or a material consumption study could be worthwhile if you are unsure of the answer to this question. Examining how much material is currently being used per hour, per shift and per week is beneficial. You should also check for seasonal special runs or other reasons for inconsistent usage.
2. Is larger storage available (and economically sound) for the ingredients in question?
Do you have physical space to store the material? This is an important factor to understand. It may not relate to process equipment, but it does affect the overall challenge of your manufacturing operation.
It is essential to review how you are currently receiving all your ingredients and how your material handling system brings this material to your processing equipment. What materials are bought in bags, super sacks and by the truckload? Keep in mind, new and larger packages may need new equipment or additional human labor. The former requires capital investment, and the latter increases operating expenses.
Weighing lower cost per pound and improved efficiency against the cost of new equipment is the key to ascertaining what investment could truly benefit your current material handling operation. 50-pound bags require very little equipment investment, but a significant amount of labor is involved in handling and unloading these bags.
A super sack unloader will provide substantial labor savings compared to bags, but it does represent a significant investment for the unloader and pick up point. As a company decides to improve its labor efficiency or reduce ingredient cost/pound, this requires capital investments in new equipment and control systems.
The points in this blog post are two critical points to consider before investing in new equipment, but there are even more factors to consider in this context. Keep your eyes glued to the AZO blog as we continue this conversation in an upcoming post: “3 More Ways to Understand When You Should Invest in Super Sack Unloading Equipment.”
AZO has more than seven decades of experience in handling raw materials and shaping ingredient automation along the way. Feel free to contact our sales team for info on super sack unloading and any questions about how to help your plant run smoothly overall.