A new strategy on compact system
“I don’t want more productivity with the compact system.”
The spinner said.
I was literally aghast at the first place.
‘I wonder how come a man doesn’t want an increase in productivity’’- I thought looking strangely at him.
On seeing wrinkles caused out of confusion on my face, the spinner smiled and continued, “Tell me why we should increase the production?” He asked me.
“Then only we can reduce the cost per kg and get lowest figure of return on investment”. Though I had replied him about the universal truth (!), I thought I was gibbering on thinking that he would be having different answer.
Out came a laugh from him as an immediate answer.
‘Was my answer wrong or did I say anything hilarious’- I thought.
Instead of speaking further, he opened a spread sheet (EXCEL) in his laptop and turned the screen towards me so that I could look very clearly.
There were many calculations comparing the cost per kg of yarn and ROI among normal machine, suction compact system, and mechanical compact system.
When mechanical compact system was giving a positive and shortest ROI with same production to level of normal machine, the suction system started giving positive ROI only at higher productivity.
“Now, you see here”, he pointed some columns on the spread sheet and said, “The ROI is much better with mechanical system whose productivity is equal to normal yarn than with suction system whose productivity is 10% higher”
“How come?”, I wondered.
“It is all because of the associated costs with the suction system. The prime one is the additional energy consumption not only for the machine but also for the humidification system for the extra heat load. Others are some additional investments required for machinery and manpower for balancing the production and handling it, respectively. By handling I meant creating new market and selling the extra production. Though somebody could do, I accept that I cannot do it.
“On the electrical side, I have to invest on new transformer to handle the extra demand because our transformers have been already loaded to their brim. Again, in that case I need to spend on monthly recurring cost for the additional demand charges. But, in my calculations I have not included all these invisible costs. If I had taken them all, there will not be ROI for suction system at all.” He finished his explanation and looked me up for my comments.
“There may be some calculation errors, or this may be applicable to your mill only”, I commented.
“FYKI I started calculating this only after discussing with my friend who is another mill owner. He had installed suction compact system. He said to me that after installation he found shortage in preparatory which was the obstacle for increasing the production in spinning. He invested for machines in preparatory before finding another obstacle at winding. Again, he invested in winding. Then he found he had to do modification in humidification plants to handle the extra heat loads. Then subsequently he found trouble in transformer which could not handle the additional loads. So, he had to change the transformer and bought additional KVA demand. Ultimately now he is experiencing a cash loss.”
I just interrupted him. “What if there was no need for such investments, if everything what you said is plenty already…”
“It is our fault to keep more preparatory, winding, humidification and high capacity transfer in the name of flexibility to accommodate any kind of counts according to market demand. In my mill and in the mills that I know, mostly the product portfolio has never changed than what has original been designed for many years. If we have such additional capacity, it is sure that we have been losing so many years with the interest on the investments.”
He paused for some time.
I had no words to counteract with him.
Then he letting a heavy breath continued.
“Then I rechecked the compact strategy. I did many calculations. The most attractive one was saving in raw material. But the inferior raw material will affect other quality parameters not only in yarn but also on fabric. I know our buyers very long. There had been not much change in their demands for remarkably high strength. So, with reduced TM in Compact in which even I get higher strength, I am sure I can satisfy their needs. While reducing TM I maintained the same GPS by reducing the speed. This has resulted in 7% overall reduction in EB power in mechanical compact system as against 7% more in suction system. So, my final suggestion is to take the first step of saving the power cost which is significant enough to make the investment and then take on the possibility of increasing the GPS based on mill resource availability.”
Though I did not understand his concept fully, I thanked him for the new information and got on my feet bidding goodbye to him.
This might be the homework for me for the months to come for validating it.