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Custom mixing--an option for cost reduction. (Tech Service).

Today's rubber product manufacturer is faced with a basic problem that is becoming all too familiar--how to balance the increased cost of manufacturing with the constraints of supplying to a market place that is continuing to look for cost reduction.

The purchasing of mixing and compounding services is only one of the options available. It is, however, a course of action that offers a number of potential savings, not all of which are at first apparent.

The following is a brief discussion of what can be accomplished by fully utilizing custom mixing services.

The first step is to decide if custom mixing is a viable alternative to your present situation. Before establishing a "working group" or doing a feasibility study, I would suggest an extensive walk through the plant, preferably at a time when interruptions can be minimized. The question that needs to be answered is two fold.

* How many people are involved in making the product I sell?

* How much space does it take?

When it comes to mixing lines, there are many variations, but several key points are constant. A standard internal mixer line is expensive and bulky. It requires high ceiling heights, reinforced floors and considerable floor space to operate and service. Depending on the degree of automation, a line requires a minimum of three employees to operate plus service people to stage raw materials and remove mixed compound. Lift trucks must be readily available to ensure the steady flow of material throughout the process. All of these require regulare preventive maintenance as well as periodic replacement of major components, even the best of equipment eventually wears out. None of this comes free.

In short, a mixing line represents a considerable investment. Can these dollars be re-allocated and used more effectively to purchase the equipment needed to manufacture additional and/or better-finished product?

The power required to mix rubber is a major operating expense. The cost of energy has continued to increase. A mixer's power demand fluctuates, but by its nature, it generates high peak loads for short periods. These peaks can significantly impact the overall power bill for the entire operation.

Water for cooling is a significant cost unless further investment is made in a closed loop water system with the appropriate temperature regulating capacity.

Adequate ventilation is required to meet health and safety regulations. This requires the exhausting of significant volumes of air that may or may not have to be filtered prior to venting. A similar amount of make up air will have to be taken in and heated (cooled) depending on location.

Operating costs are what they are. A mixing line requires raw materials, and these take up space. A typical compound requires 10-15 separate items. All come in various types and sizes of containers requiring separate storage space, and in some cases separate storage conditions (i.e., hot rooms for polymers and plasticizers). Of course, no one uses just one formula, so the pressure on raw material storage is constant. Sometimes too little space is a valuable thing.

A mixing line generates two products; rubber compounds and garbage. The waste stream consists of wood, paper, plastic, cardboard, rubber, dust, etc. Depending on the manufacturing location, this waste may have to be sorted prior to disposal. While the regulations may vary by region, the increasing cost of waste disposal and maintaining compliance to changing environmental regulations cannot be ignored.

It is obvious that a considerable amount of time, effort, space and investment is required to produce a raw material (mixed rubber compound) that can now be turned into a finished product suitable for sale.

The purchase of rubber mixing services offers an opportunity to streamline and simplify the manufacturing process, allowing a company to focus on its area of expertise, namely the manufacture and sale of its particular finished product.

The workload placed on a purchasing department can be significantly reduced when mixed compound is purchased outside. Instead of hundreds of items sourced from a variety of venders (20 plus?), one can look at two or three vendors supplying the total number of compounds used. The monitoring of costs is simplified and the true cost of the material used in producing each part is much more visible.

Purchasing fewer items frees up time and space in the plant. The receiving function is less complicated. Demand for storage space is reduced. Compare one skid with 1,000 lbs. of mixed compound to fifteen part skids of ingredients. Mixed compound can be supplied in stackable, returnable containers, eliminating the requirement for rack systems and freeing up floor space. The returnable package also helps to reduce the cost (both time and people) of waste disposal.

Material that is easy to purchase must be easy to use. Most custom mixed compounds are supplied in a ready to use form. This includes test data, material safety data sheets and, in some cases, certificates of compliance to "part specific" specifications.

The control and disposition of "non-conforming" batches remain with the supplier, allowing manufacturing to concentrate on the job at hand.

The purchase of fully compounded material reduces the cost of compliance to various environmental standards. The number of regulated materials is reduced along with the cost of testing and monitoring these items. For example, the elimination of process oil storage from a site can reduce the costs associated with the provisions required for the containment of basins, ground water monitoring and insurance.

To this point, we have only discussed the purchase of existing compounds without any changes to raw materials or specifications. Developing a working relationship between the technical departments of the mixer and the manufacturer can yield benefits in several areas. A review of existing compounds to consolidate raw materials to standard stock items can reduce lead times as well as cost.

In mature compounds, this review often highlights ingredients that are no longer readily available. What was once an item added to reduce cost could now be a cost escalator.

Established compounds may need to be reviewed to improve processing or reduce finished product scrap. This is an area where cost added to the compound can result in improved productivity resulting in a lower final cost to manufacture the finished product.

The area of compound development for new applications has many positive opportunities. Most custom compounders have a library of formulations that have been developed for use in various applications. They are process proven and have been certified to the appropriate specification. This greatly reduces development time, leaving only plant trials to optimize the material to fit the production equipment to be used.

By working together to develop new compounds for new applications, potential problems can be addressed at an early stage. Minor modifications to a design or specification can prevent cost being built into the part; cost that can prove to be very difficult to eliminate at a later date. The objective is a material that is suitable for the application at a cost-effective price. By working together, one hopes to avoid the dollar solution to a fifty-cent problem.

My comments cannot provide an answer to whether custom mixing is a viable alternative to any particular situation. They can, at best, generate a list of questions that are specific to each manufacturing facility. The answers to these questions will provide the basis for a factual evaluation of the cost-effectiveness of using custom mixing services.
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Author:Lennox, Tom
Publication:Rubber World
Date:Mar 1, 2003
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