Automation Q&A
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Asked April 2nd, 2010
Factors that affect this decision are: (1) glue versus heat sealed wallet, (2) the pricing of your contract relative to the labor required, and (3) the length of the contract. First, a glue wallet is typically produced with automated machinery but heat seal can be done semiautomatically. If a glue wallet is required, so likely will be an automated solution regardless of line speed. Pricing, labor cost, and length of contract are all related. A simple assumption of $40K annualized cost per line operator with a two shift operation is $80K annualized per operator position, which is potentially reduced by automating. With only reducing the line by a handful of operators, via automation, your payback can be as little as one year. This also goes to the length of the contract. If you can get at least an 18-month or two-year contract (or longer), then its likely that you will benefit from automating your line. Also, once the job is finished, you’ll own the asset and can sell time on it for new projects. Feel free to contact me directly with your particular scenario.



