19 May 2017 //
by Matt Rose
For many product manufacturers it is common practice, or even a requirement to receive multiple quotes on new packaging equipment purchases. Getting multiple quotes allows the purchaser the opportunity to review and compare packaging equipment manufacturers and weigh each proposal.
It’s also not uncommon that, when reviewing a quote, to almost immediately flip to the price since it carries the most weight. In many instances, the price alone often has the potential to make or break the quote, regardless of the information contained on the unread pages. However, making a purchasing decision based solely on price can ultimately be incorrect and costly.
Making Dollars and “Sense” of Packaging Equipment Quotes
When comparing packaging equipment manufacturers, it is important to dig deeper into the price, and determine – what is truly included in that number? Doing an “apples-to-apples” comparison can help to determine the best value for your needs, as well as eliminate any unanticipated surprises after the purchase – which can lead to change orders, delays, and additional costs.
Often times, each equipment manufacturer prices their equipment differently based on company’s protocols and interpretation of what is being requested. Three common ways packaging machines are quoted are:
- Package lump sum deal comprised of a base machine with a host of options and services added in
- Bare-bones machine with an à la carte list of available ancillary equipment and services
- Hybrid package solution that provides some options with the machine and offer additional ancillary equipment and services for separate purchase
Depending on the application and machine, ancillary equipment and services have potential to fluctuate the level of investment up to 30%, or more. Therefore, it’s critical to know exactly what is (and isn’t) included in the price tag. Breaking down parts of a quote and putting into a vendor comparison matrix can help you understand and compare multiple packaging equipment quotes. Parts to include in a matrix include:
- Machine Options
- Factory Acceptance Test
- Spare Parts Kit
- Maintenance Plan
Don’t Ignore the Details
Once you’ve created a vendor comparison matrix, it’s important to dig deeper to understand what is included in each of the numbers. Lack of detail can delay the purchasing process, and present challenges down the road about what is and was not included in the final number.
Critical elements that you should look for in a quote when comparing packaging equipment manufacturers include:
- Breakdown of all system components along with an understanding of how the machine is assembled and the general quality of the build.
- Detailed lists of the specific mechanical, electrical and pneumatic components to be used.
- What type of electrical controls (PLC/HMI) are being proposed, do they meet both your line needs as well as your existing control structure?
- Step-by-step walk-through of the method of operation.
- Information regarding the machine’s specific features and benefits.
- Machine frame and structure type.
- Packaging machine’s utility requirements. If other options are available does it identify them?
- Parts warranty and time frame.
- Is there a guarantee on system performance?
- Supplier’s payment terms.
- System delivery schedule.
- System testing and acceptance protocols. What can you expect at the FAT? Are both parties in agreement of the testing and acceptance protocols?
- Is system testing included in the price?
- What services are available after installation (i.e., parts, technicians, preventive maintenance, and special programs)?
Using these guidelines to review and compare quotes, an equipment purchasing manager should be able to easily identify the machine being proposed, the packaging machine manufacturer’s level of confidence in their products and services, and the true cost of each proposal.
Are you looking to purchase a new shrink bundling machine or the process of reviewing quotes have concerns about the accuracy, quality or cost? Contact us we’re here to help.