Whether consumer direct or B2B, every market has its own unique trends that define the requirements for success. In response to these trends, you enact processes specifically designed to effectively serve your customers, gain a competitive advantage, and remain profitable. But trends shift over time as customers react to the changing world around them. You may perceive this as negative, as your customer’s needs conflict with the operational and profitability goals of your business. But what if this can BE your competitive advantage?
An excellent example can be found in the Coil Coating Industry…
Coil coaters apply protective and decorative coatings to steel or aluminum coil stock. These “pre-painted” coils are then used to make products you see every day, like computers, TV’s, appliances, light fixtures, building siding and metal roofs, just to name a few.
These are large, complex, capital intensive lines; capable of coating coils up to 72” wide, weighing as much as 50,000 lbs., at speeds of up to 900 FPM. Like most manufacturing processes, they are most efficient when run continuously.
We became involved in the industry in 2005 when, to address shrinking margins brought on by intense competition, we helped coaters become more efficient by inventing a way to accurately control the temperature of the coating being applied to the metal. In those days, customers ordered multiple coils of any given color. Though the lines are capable of coating a 40,000 lb. coil in less than 15 minutes, runs were long – from a few hours to a few days!
Enter the economic downturn of 2008 – 2009…
The trends shifted. Downward pressure on pricing increased. Striving for leaner operations, customers sought to lower their inventories. They began demanding smaller, more frequent shipments with shorter leadtimes, forcing coaters into shorter runs – often just a portion of a coil. These shorter runs meant more frequent color changes which increased costs for cleaning, setups and quality control.
But some of the highest costs are hidden…
A typical 40,000 lb. coil requires about 20 gallons of coating. Filling these large systems requires an additional 20 – 30 gallons of coating or more. This means that coating a half-coil order still requires a full 50-gallon drum of coating of which upwards of 40 gallons will be left over – to be placed in inventory or scrapped. At $30 - $80 per gallon, these “partial drums” go onto overhead – not job cost, but secretly add significantly to the cost of running that small order – especially for a single-run, custom color. Add in the cost of setup and cleanup, and that small order gets very expensive to produce.
As in 2005, we watched our customers struggle with these changing demands and decided there had to be an innovative way to reduce the fill volume of the coating system, control the time and cost of clean-up between colors, and reduce the setup time for a new color.
Read our free article in Coil World Magazine to learn more about how our Profile Correction Module (PCM) can reduce coating issues and increase efficiency.