Introduction

In the competitive mold-making industry, it is generally accepted that throughput is key to keeping production costs competitive because shops want to increase productivity while maintaining profitable margins on their sinker EDM-related operations. As such, part of management’s strategy often includes investment in new equipment and technology. Investing in technology is as important to global competitiveness as optimizing asset ownership.

THE TCO ANALYSIS

The Total Cost of Ownership (TCO) model and analysis is the best practice when purchasing new equipment. Part of this evaluation process should include an audit: an evaluation of current equipment and manufacturing operations to determine the capacity or capability for meeting present and future operational requirements. Figure 1 illustrates the events that should occur during a TCO audit. An audit is used to do the following: 

• Compare actual performance to benchmark performance of the equipment
• Examine areas to improve productivity
• Determine lost revenue due to inability to quote desired new business
• Evaluate production timelines and inability to meet deadlines
• Check scrap rates due to out-of-tolerance cavities and cavity flaws
• Track out-of-warranty equipment servicing and maintenance
• Analyze economics of upgrading, refurbishing, or disposing of existing equipment as opposed to replacing