How to reasonably control the profit and cost of corrugated board

I believe many manufacturers of corrugated cardboard are asking, “The equipment has been improved, the production capacity has been improved, and why are we still unable to make any money?” is the market downturn or the price competition between peers? But no matter what the factors are, actually every Personally, my heart is also very clear that in the past, the era of high profits has ceased to exist. In addition to the current production, quality, the most important thing is to fight management - how to reduce costs. In the past, every salesman may have to learn the company's quotation formula: cost + profit = selling price, but now the market's operating rules are: selling price - cost = profit.

The price controls are in the hands of customers. With so many competitors, you can often decide not the price part, but “do not do it”. If you don't do it, you can only wait for death. If you do it, you don't necessarily have to make a profit. That is to say, if cost control is not good, profits may also be negative. This shows that cost control is undoubtedly the biggest issue that determines the survival of a company.

Currently, there is a trend in the corrugated paper packaging industry where the equipment is getting bigger and bigger and the production capacity is getting higher and higher. Everyone wants to apportion the same cost by increasing production capacity, and accumulate profit by production. For example, if one thousand tons were used each month to earn one million, now it is up to two tons to maintain one hundred per month. Million profit. Basically, this idea is not wrong, but everyone has overlooked one issue: 1. In order to increase the cost of equipment invested in production capacity, and whether the increase in raw material costs and increase in liquidity after the increase in production capacity really helped the company?

This is a question worth pondering. Moreover, the relative high loss of production capacity is great. If there is no good management tool, the result is still no money to earn.

The cost of spreading corrugated board, raw materials (fabric and corrugated paper) accounted for more than 70%, in several highly competitive coastal areas also climbed to nearly 80%, other fixed costs accounted for only about 20%. This shows that improving the cost of raw materials is the key to truly controlling profits. So, how to effectively reduce the cost of raw materials?

The following provides several common practices for the industry:

Cash-buying paper-the use of cash transactions to reduce the price of raw materials, but the large demand for cash, the current return of funds to calculate the cost of 3 months, three times the turnover of financial pressure is considerable.

A lot of paper--to buy raw materials to reduce the price of raw materials, the same high demand for capital, inventory pressure, if raw material prices fluctuate, winning or selling cardboard cardboard box is also powerful, a bit like buying goods, "press treasure" The risk is high. The use of alternative materials—for example, 125g class A paper instead of 175g class B paper, achieves the same purpose in physical pointer measurement, but the raw materials used may be cheaper, how to use it, test customer acceptance, and test the manufacturer Smart.

Controlling production equipment - Effective control of existing equipment, such as the use of computer production management systems to save raw materials, paste control, and temperature control, etc., with little investment, but at least save money It is 3% to 5% more than the province of human labor.

Below we will analyze the cost-effectiveness of this part.

We have repeatedly compared the installation of the production management system at the customer's side and discovered some interesting phenomena. For example: before the installation of the boss asked, how much the average speed? A: about 100 meters / minute

Q: How high is the board machine wear? A: About 4%-5%

The actual production of the first three days after installation was actually calculated by the computer: the average speed: 45 meters per minute, and the loss of the board machine was about 8% to 12%. The first month after installation, the actual calculation by the computer: the average speed of 60 meters per minute, the board machine loss of about 6%. Decline in starch use: 10%, 2 months after installation, the actual calculation by the computer: the average speed of 80 meters per minute, the loss of the board machine is about 3.5%. Starch use decreased by 15-20%. This is a real case, it shows that there is a great difference between people's feelings and actual data. For example, the operator only sees the normal normal speed reaching 100 meters per minute, but ignores how much time the parking stops and ignores how much bad paper is made. In fact, the real production capacity can only reach the average speed = good length / (production time + parking time). In addition, the meaning of “bad products” does not mean only those papers that are really bad. For most paperboard suppliers, doing more than that does not mean that there is money, but the cost loss and productivity. reduce.

However, there are many kinds of products with various kinds of production management in the company. How to choose, the key is not only the comparison of the prices, but how to achieve the purpose of saving raw materials precisely. Especially for the accuracy of paper change, good can be controlled at about 1 meter, bad error will be as high as 20 to 30 meters! In addition, provide computer automatic paper quality, speed control paste amount, so that when high-speed operation can be automatically Reduce the gap between eating pastes, and increase the amount of paste to be appropriate when running at low speed. This will save at least 15% of the amount of paste. Moreover, for the temperature control part, the computer can also automatically adjust the baking area of ​​the preheating cylinder according to the paper quality and the speed of the carton to ensure the hardness of the cardboard, etc...

Source: China Packaging News