So you’ve got a project that is going to require a new piece of pad printing equipment. You obtained the requisite three quotes, and an extra one just to be sure. Quotes A, B and C come in between $15,000 and $18,000. Quote D is for $10,000.
Which proposal is the least expensive?
If you answered “D”, you’re probably incorrect.
If three of four quotes come in closely grouped and the fourth is a significantly “less expensive” flier, it should throw up a red flag.
Why? Because whoever is selling that machine is only selling you a machine. They aren’t providing, nor do they intend to provide, a solution. Most likely, this failure will come in the form of little to no technical expertise or support.
I’ve seen it happen hundreds of times, perhaps a thousand times. Companies buy the cheapest thing they can find, new or used, and then struggle for months or even years, usually at a cost that is several times what they paid for the “least expensive” (cheapest) machine. All in an attempt to reach a level of efficiency and productivity that could have been realized immediately, had they simply taken the time, or cared, to purchase more intelligently.
The secret: production cost analysis.
When I quote solutions for applications, I run them through a cost analysis program that I created, entering factors including machine rate, labor rate, efficiency, scrap, number of colors, volume of ink, thinner and other additives required, pad cost and pad change frequency, cliche type and dimensions – all resulting in an estimated cost per part accurate to $0.001.
Guess what? The “cheap” machine loses, every time.
Want to know what your ROI really is before purchasing your next machine? Learn how to perform a thorough production cost analysis.
If the company from which you’re buying can’t help you out with that, and/or aren’t willing to show you the math in an apples-to-apples comparison versus “the other guys,” walk away from their proposal.
Don’t fall prey to the vicious cycle of under-investment. Buy smarter, not cheaper.