by Nestor Gula
Automatic material handling systems are cost effective in low and high volume shops
Investing in high speed machinery to manufacture parts makes sense for many shops. Feeding these machines efficiently, and removing the finished parts, also makes sense.
While automated material handling systems used to be rare luxury additions to laser cutters, they are now becoming commonplace.
“Ten years ago, a quick and dedicated operator would have had a much better shot at keeping a laser fed with material,” says Jason LeGrand, automation specialist at MC Machinery. “That’s no longer the case. The increased speed and productivity of today’s machines have made automation more necessary and our ratio of automation to stand-alone laser sales has risen significantly as a result. The bottom line is you can’t take advantage of the speed of the laser if you can’t load and unload as fast as you are cutting.”
Efficiency of a shop’s production flow is one main motivating factor to implement a material handling systems. Keeping fast moving laser cutting systems working means the investment in that laser system will pay off sooner.
“On average, we estimate about 60 per cent green light time with the standalone machine because you are at the mercy of the operator having to unload the parts, get the other part ready or get the other sheet ready. If we use the 60 per cent industry standard for standalone systems, we know that in an automated environment you can get up to about 85 per cent efficiency,” says Dustin Diehl, laser division product manager at Amada America. “So right there is where you start to calculate the savings in increased production.”
Companies contemplating investing in a speedy new laser cutter might be a bit shy about investing in a material handling system because they might feel they do not produce the volume necessary to justify the added expense.
“If you only have work for a machine for half-a-shift per day, automation might not be the most cost-efficient way,” says Tobias Reuther, product manager, automation group at TRUMPF Inc. “But if a machine is utilized more than one shift or there is growth in business expected, automation can help streamline processes and reduce reaction time to get additional orders.”
Automated material handling systems are flexible, able to deliver sheets of various thicknesses and materials to the laser cutter quickly and unload the finished parts. “On the laser, where you have very small volumes with a high product mix – you have three of these, five of those and ten of these. You have to make the parts just in time,” says Lutz Ehrlich, punching and automation product manager for Prima Power North America, Inc. “The secondary process of taking the individual components on the skeleton and discarding the skeleton and reloading, even with automation, that’s a manual process.”
Low volume shops might also opt for an automated material handling system because of the ease such a system offers when loading sheets onto the laser cutter. “If you have a sheet of material that takes an hour to cut on a laser and that sheet of material is probably 800 pounds, what do you want to do? Do you want to try and pick that up?” asks Bill Bossard, president of Salvagini America.
There are a couple of reasons to automate your load and unload, continues Bossard. “One, we can provide a load/unload system that can take the parts off the laser and load a new sheet in a hundred seconds. I don’t think you can do that manually in that speed. Number two – when you go to thick heavy material, you certainly don’t want to have a man with a jib crane and a vacuum lift moving that material around trying to position it on the laser. From a safety and common sense standpoint, that doesn’t make any sense. So, the other reason to put automation on your laser is so you can run it unattended.”
A laser cutter with an automated material handling system means that even low volume shops can reap the benefits of such a system. “You don’t necessarily need to produce a certain volume to justify an automated material handling system,” says Dan Caprio, punching product sales manager for LVD Strippit. “In the past, automated material handling made sense primarily for high volume production of like or similar parts using a common material type, thickness and size, but today there’s much more flexibility. Most systems are able to automatically change part programs, giving the user the flexibility to schedule jobs that use different material sizes, thicknesses and types. This allows the fabricator to schedule small to medium size batches efficiently.”
These systems are not cheap. “The investment for an auto load for a laser machine is going to range anywhere from $65,000 to as much as maybe $200,000,” says Bossard. “The economic argument is that you would replace labour. You’re not going to save any material. You’re not going to save a whole lot of other cost components inside the fab shop so it pretty much all boils down to the labour, with the possible exception of a situation where you’re doing surface critical material such as stainless. A manual load technique might tend to scratch the surface of the material that you’re trying to get up on to the shuttle table.”
Simple savings in labour might not be enough to justify the cost of an automated material handling system, so the conversation should focus on the profits that such a system can generate. “Justifying the tangible additional revenue of an automated material handling system can be calculated by the net increase in the percentage of utilization and calculating the resulting net profit,” according to Frank Arteaga, head of product marketing, market region NAFTA for Bystronic Inc. (See below.)
Calculating profit with an automated material handling system
When justifying an automated material handling system, it is important to calculate the additional revenue and net profilt. The proper way to look at this is to see how much profit such a system will generate.
“Justifying the tangible additional revenue of an automated material handling system can be calculated by the net increase in the percentage of utilization and calculating the resulting net profit,” says Frank Arteaga, head of product marketing, market region NAFTA at Bystronic Inc.
To calculate the degree of utilization in your shop, Arteaga suggests using the following equation:
(actual machine processing time/total machine on-time) x 100. Example (1400 hr/2000 hr) x 100 = 70 per cent utilization.)
If you were to add material automation to the equation and you verified, for example, an increase in utilization by 20 per cent, then the equation would be:
1800 hr/2000 hr x 100 = 90 per cent.
“In this case, we gained an additional 400 hours of actual machine production time per shift in a year by adding the automation. If we are running three shifts, then the net gain is 1200 hours,” explains Arteaga.
The calculation of additional net profit then becomes:
Hourly charge rate – total hourly cost (fixed and variable) = hourly net profit.
Hourly net profit x number of additional production hours = additional yearly net profit.
The additional yearly net profit can be used to calculate the return on investment (ROI) in years:
(cost of investment / additional yearly net profit) = ROI in Years.
While these calculations represent tangible additional revenue and profit, intangible benefits must also be considered. Arteaga says intangible benefits may include faster delivery times to the customer, improved operator ergonomics and safety, improved operator multi-tasking capabilities and improved part quality.
Shops with older equipment might be tempted to upgrade their laser system with an automated material handling system.
“All of our machines going clear back to the early 2000s, they are all automation ready so at any time you want to upgrade you can upgrade in various increments,” says Diehl. “Just maybe upgrade to a single source, one pallet of material, one pallet of finished parts. You can start there and then add a tower and then add multiple machines. That’s probably the beauty of our flexible automation is that it kind of grows with our customers even if they started out with a standalone machine.”
Some older systems though might not be able to integrate a material handling system.
“The measures that have to be taken for the connection depend on the vintage and the preparation of the machine for automation,” says Reuther. “This can range from no measures at all (just install the automation at the machine), a simple software upgrade or if the machine vintage is old (e.g. 15 years), even an upgrade to the control system. In some cases, it does not make sense to upgrade a very old machin.Replacing it with a brand new complete system” may be the better way to go. SMT
