Rubber & Tyre Machinery World

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The Ultimate Guide to Asset Management

If you had read my earlier post “A New Hope: Top 6 Things I Learnt At NRC 2015 Mumbai“, then you would have also read my learning from Naushad Shikalgar of J.N.Engineering – ‘Proactive Machinery Maintenance is not an expense and is an investment that has long-term benefits’.

Maintenance is important in any organization. Without proper maintenance, assets deteriorate over time reducing the quality of your output produced. It can also impact the safety of your asset or your people who operate it.

Traditionally, maintenance has been viewed as a cost center in an organization because it costs you money to hire maintenance technicians and purchase the spare parts to keep your systems running smoothly. Too often, senior executives ignore the value-add that maintenance can bring to your organization. These include:

  • A reduction in reactive maintenance costs
  • Reducing costs to restart production after a breakdown
  • Limiting production scrap
  • Costs of downtime such as missed orders and lost revenue
  • Customer perception/satisfaction
  • Improved quality of products
  • Reduced environmental impact

 

By definition, Asset management is a systematic process of deploying, operating, maintaining, upgrading, and disposing of assets cost-effectively.

During his talk, Naushad spoke extensively on Asset Management Strategy-Plan-Execution including the various approaches to maintenance that I found interesting and hope you too would like it when you read. Hence, I have reproduced the 34 slides (click on the picture below) here that effectively forms a comprehensive guide on asset management.

Asset Management

Click on Image

Summarizing, asset management focuses on assuring your people, parts and processes are optimized to improve asset performance. Reducing inventory, maintenance costs and the number of downtime events raises your productivity, while simultaneously driving financial performance and predictability. It also helps your employees with the right tools to make good decisions about driving your plant performance.

Do you agree? How do you look at Asset Management?


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What the Heck Is Total Cost Of Ownership of A Rubber Machinery?

“What the heck is total cost of ownership of a rubber machinery?”. If this question has popped up in your heads after reading  Prof. Dr.-Ing Andreas Limper’s interview, you are not alone.

Neither is this concept new.

Dr. Limper explains, in his interview, that the inability of a customer to see the ‘holistic perspective’ and evaluate machinery on ‘ownership cost’ basis is frustrating. This is because, most buyers select a rubber machinery on the ‘initial cost’.

“So what?” you may ask me.

And at this stage of our conversation, if I add that your ‘initial cost’ (basis which you made the strategic capital purchase) represents not more than 13-15% of your ownership cost!

TCO - Iceberg

Reference Image Only

Well, do I have your attention now?

Let me explain.

Simply put, the Total Cost of Ownership (TCO) is the total cost of your rubber machinery over the whole of its life. You can also complexly word it as ‘sum total of your purchase, ownership and post-ownership costs of your rubber machinery in a quantitative and qualitative manner’. (jargons?)

This means in your TCO calculations, all your obvious and hidden costs of ownership across the full life cycle of the rubber machinery has to be considered. There is often room for judgement and sometimes different opinions, in deciding what is the appropriate lifespan for you to analyse.

This is because some of your costs will be one-off, others will be recurring – so you need to know how many years you intend to use this machinery. For example, you could consider Depreciable Life (i.e the number of years in which the machinery is depreciated) or Economic Life (i.e the number of years in which the machinery returns more value to you than it costs to own, operate, and maintain) or Service Life (i.e. the number of years the machinery will actually be in service).

In some cases there may be some residual value in the machinery or parts. However, you will also have costs associated with its disposal.

Here’s a typical compilation of all costs associated with the purchase of your rubber machinery.

Purchasing Costs (includes but not limited to)

  • Market Research including business directory purchase
  • Consulting or specialist advice for machinery assessment and its appropriateness for your use
  • Supplier identification costs like administration costs, telephone calls to discuss, travel, accommodation costs for factory visit and negotiations, etc.
  • Purchase Price of the Machinery & its required accessories
  • Delivery Costs (freight) and insurance
  • Warranties
  • Installation, erection and commissioning costs
  • Trial run and Training
  • Licences for software and automation
  • Insurance costs

Operating Costs (includes but not limited to)

  • Consumables, ‘Wear & Tear’ Components
  • Regular Maintenance or Servicing (Self or Outsourced)
  • Spare Parts
  • Energy/Electricity Consumption Costs
  • Breakdowns & Repair Costs
  • Extended Warranties
  • Operator Costs
  • Cost of replacement service during a breakdown such as hiring (another) machinery or outsourcing the work.
  • Licence renewal/ software upgradation costs
  • Insurance renewal costs

Disposal Costs (includes but not limited to)

  • Decommissioning costs, involving technical specialists.
  • Transportation of the machinery away from the Plant
  • Disposal Fees of machinery and/or its parts as per your country laws
  • Data migration costs from existing control instrumentation and records
  • Other related cost of change of machinery after its life
  • Site clean-up costs

Resale Value: You should remember to add back any money received on the resale of your rubber machinery and its accessories.

Your formula for calculating the TCO thus becomes

TCO = Purchase Price + Regular Recurring Costs + Irregular One-off Costs + Disposal Costs – Income Generated – Revenue on Disposal/Resale Value. 

Do you get the ‘drift’ now?  

Do you agree with me that your decision to buy a rubber machinery only on the basis of initial purchase price could be a flawed strategy and need a rethink (…..if you are doing this, like the majority of other rubber machinery buyers!!).

Having outlined these thoughts, let me also caution you that the success of your evaluation depends on the type of the machinery you buy.

For example, you would not want to get into the same evaluation techniques when you buy a relatively simplistic (or one-off) machinery like bale cutter or sheet feeder as compared to a project investment of a mixing line or rubber mixing room.

Do let me know!

Summing up, the Total Cost of Ownership (TCO) is the total cost of your rubber machinery over the whole of its life and, I think, should be the most important criterion when you invest in projects and/or strategic capital purchases.


Contact me if you seek more details on this topic. Or if  you are looking for New or Used Rubber Machinery?

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An Introduction to Tire Buffing Machine

Tire Buffing Machine is a widely used tire retreading equipment. The other known names include Tire Buffering Machine, Tire Buffer, Tire Buffing Apparatus, or Raspers.

When you get a tire that passes all the initial checks and is certified as a worthy candidate for retreading, your first job is to buff this tire. Buffing is the process by which you remove all the old-worn tread on the tire, and prepare the tire casing for the application of a new tread. Buffing also trues up (the roundness) your tire casing. A buffed tire gives you a textured surface on the tire casing and this aids in proper adhesion with the new retread that you will later apply on this surface.

Tire_Buffing_Machine 1

An Image From The Web

Typically, a tire buffing machine has a rasp pedestal and a connected mobile assembly to swing the rasp pedestal perpendicularly. Each rasp pedestal has a rasp head and a texturing device. The rasp pedestal rotates about a vertical axis. A tire hub assembly on this machine rotates the tire casing. The tire buffer is controlled by an operator station through an operator console unit.

Tire_Buffing_Machine

You get tire buffing machinery to buff all the available tires – large or small size, radial or bias, two-wheeler or OTR. The speed of spindle varies according to different tire size. Usually lower speed is apt for bigger tires, and higher speed suitable for smaller tires. These are all free-standing machinery and equipped with a dust collection system for pollution control. 

Tire_Buffing_Machine 2

Image from the Web

Safety mechanisms to increase life of the grinder, automation of operations through computer-controlled programming, ancillary equipment like tire loaders, automatic lifting and centering of your tire, measuring device to ascertain steel wires (and thus prevent its damage), efficiency and precision of buffing, automatic blade-wear compensation, automatic reverse rotation of buffing head, blade cooling, sound-proof enclosure and overall user-friendliness will differ from manufacturer to manufacturer depending on the machine you select.

Tire_Buffing_Machine 6However, the operations are mostly similar and easy to visualize. First you mount the tire onto the expandable hub on the tire buffing machine. Then you inflate the this tire to its normal running shape. This action ensures that your tire is buffed to the correct profile and radius. When you delve deeper into this subject, you will notice that every tire buffing has its specific settings to be considered on the machine (either manually or automatically programmed). Few of these settings include Expandable Rim Number, Tread Size, Radius, Trim Angle, Cut Depth, Shoulder measurements (left, crown and right), and finished buffed circumference. Attention to these parameters ensure that your final retreaded tire provides its peak performance always.

Before you start buffing, care has to be taken that impregnated stones or foreign materials that could cause potential damage to the tire buffing machine needs to be removed by the operator. And always start buffing at the highest part of the crown of the tire. This prevents overloading of the buffer. Operate your tire buffer until all of the tread design is removed.Then you buff the shoulder and side walls as is appropriate to your retreading process.

If you leave much of under-tread on the rim, you will find it very difficult to skive the casing (for repair). Also excessive under-tread can cause high heat generation when the tire is put in use. This can lead to retread failure. On the other hand, if you do not have enough under-tread, this can affect the bond between the casing and the new retread you will apply on the textured surface.

Summarizing, tire buffing is part of the tire retreading operation and tire buffing machine removes the tread of your worn tires.

I look forth to your comments.


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