Volume 40, Issue 6 June 2005
Why Automate? Why Not
In IG Production, Companies Make the Decision
Based on Individual Circumstances
by Charles Cumpston
To automate or not to automate? That question may not be worthy of Shakespeare, but it is an important one when it comes to insulating glass (IG) production. Today, it’s generally agreed that fabricators have to offer a range—if not the complete range—of fabricated products to compete successfully in the market. It’s true that IG equipment suppliers aggressively promote their products and with the companion truth that labor is hard to find and keep, we’re back full circle to the original question.
When Virginia Glass Products of Martinsville, Va., asked the question, it came up with the automate answer. As Desert Glass Products of Las Vegas ponders the question, it has not yet seen the circumstances that will make it automate. Here are the two sides of the coin.
Reasons to Automate
Virginia Glass Products Corp. installed a Bystronic TPS automated IG line in the fall of 2002. The company started from scratch as it had not produced IG previously. It took six weeks to install the IG line, after which the company ran tests and trained for about two weeks. According to Ben Beeler, executive vice president, it took
approximately a year from the time the company started talking about going into IG production until the decision was made to make the go ahead.
“Our reason for adding IG production was product growth and expansion of our current product line,” Beeler explains. “We felt that there was room in the IG market for another manufacturer.” Overall, the fabricator serves a region from Maine to Florida and west to the Mississippi River, but its IG region is smaller—the Carolinas, Virginia, Washington, D.C., and Maryland, into New York, Pennsylvania and Eastern Tennessee.
Out of the Gate
“From the start, we had decided that we needed to be automated. We were one of the few temperers that didn’t insulate,” Beeler says. “The majority of the insulators were automated to some extent and so we felt [that in order] to compete we needed to be automated, at least to the same extent as those companies already producing IG.”
In investigating its alternatives, Virginia Glass Products saw an opportunity to get into the market with a unique product, and that had appeal.
“The thermal plastic spacer (TPS) technology allowed us to get into IG production in a different way than everybody else,” Beeler states. “The timing was right.”
According to Beeler, the primary challenge in making the decision was justifying the investment. “Once we had the figures to support the investment, the next step was to make the choice from the available options. Once we had decided on which option we were going to choose, the next challenge was finding personnel to operate the line.
We were lucky in that we were able to hire a production manager who had experience with this technology. Once the machine was running and we were ready to go to market, that was the next challenge—going to market.”
The company had to introduce itself as an IG fabricator and it had to introduce its new product to the market. This was done through the sales reps and the sales team.
“We immediately started getting requests to quote,” Beeler says. “We expected there would be some resistance to this new product in the field from the architects and glazing contractors.” He says that the company was even prepared to produce IG with metal spacers as well as the TPS technology. “We had a back-up plan because it was a new technology, but we never had to use that option. We have not had to produce the first metal spacer unit.” While the company anticipated there would be some jobs that would require the metal and would not accept the TPS spacer, Beeler says they’ve not experienced that.
One Hand Washing the Other
The theory that fabricators expand their market by starting to produce other fabricated products has proven true for the company.
“There is a synergy between the other fabricated products we were producing and the IG,” states Beeler. He points out that they have exceeded their IG sales goals. “Also, we’re selling our core products to people who previously were not buying from us because they are now buying our IG,” he states.
Does he think that part of selling a more extensive product line is due to the ability to offer one-stop shopping to clients?
“I don’t know, because typically on a curtainwall job [customers] are not necessarily buying the interior glass at this point. And it is not always handled by the same people,” he explains. “I think it is more a recognition of our quality. The IG has given us the opportunity to introduce ourselves to people who, heretofore, had been buying their regular custom glass and entrances from the same supplier they were buying their IG from.”
So, would Virginia Glass Products have done anything differently in starting its automated IG line?
“I don’t think so. I think getting into IG for the first time there might have been some things which we were not as prepared for as someone who was already doing it; that probably goes without saying. I think we would have fine-tuned some things, but overall the decision would have been the same,” Beeler states.
The personnel factor was an important one for the company. It was one of the most important factors that led it to go with an automated operation.
“One thing we liked about this line was that it needed less personnel [than a manual system],” Beeler explains. “Labor is harder to get, harder to keep, and harder to train and this technology took some of those variables out of the picture,” he says.
One thing Beeler says he learned is that as you’re going through the process if you discover something you think is going to improve it you should go ahead and do it.
“One of the things we decided midstream in the installation process was to build a climatically controlled house around the line. We thought by putting this in a room by itself with limited access we could better control the cleanliness of the unit and the air in the airspace,” Beeler explains. “It was a good decision. Everyone who had seen it has said that this is the cleanest environment they’ve ever seen.”
And he says there was minimal disruption during the process.
Flip the Coin Over
The situation at Desert Glass Products is different than at Virginia Glass Products.
Matt Hale, a consultant and company spokesperson, points out that IG was one of the original products the company manufactured, starting in the third quarter of 2003. However, production there is project driven.
“One thing unique to Las Vegas, and for us, is the product mix,” he explains. “We focus on monolithic 3/8- and ½-inch tempered glass. This is what the casinos and hotels use.” The upscale nature of the retail environment determines this company’s average order. For example, the new Wynn hotel that just opened used an incredible amount of heavy, monolithic, tempered glass fabricated with notches and holes, beveling and mitering,” Hale points out. “That has become the average order in Las Vegas, compared to a plant in most parts of the country where you get a lot of 1-inch insulating. Vegas is much more a specialty market,” he explains.
In assessing the Las Vegas market, Hale states, “Whenever a mega-resort [is built], it’s got all this upscale shopping area and that’s a third of their revenues so that area needs 3/8- and ½-inch glass and a lot of mirror. We’ve been successful in working with the large contract glaziers in Las Vegas ... Cost is not necessarily the most important consideration when they need it right away.”
According to Hale, having a production level of 9,000 to 10,000 square feet of IG a day makes automating feasible. At Desert Glass, average IG unit production is 3,000 square feet a day.
“I don’t know when that [level] will occur for us. I guess when our customers need it. At this point we’ve been able to very easily handle the demand we get for IG with manual production.”
He points out that the company’s plant is as modern as any.
“We just have not seen the need to take that plunge into insulating automation.” He does point to post-temperable, soft coats as a possible catalyst. “It would be customer driven. If our customers want this product it would probably be easier to handle automatically than manually,” he explains. “For us, IG production is half to 2/3 of what the typical plant would be. IG is not as much of our product mix as tempered glass,” Hale adds.
He makes the point that perhaps many companies automate to avoid “being held hostage by labor.”
“That’s the reason they’ve taken that plunge, to have equipment rather than employees,” Hale states. “You pick up a lot of flexibility with an automated line, but then you’re hostage to your maintenance guy, because if that line goes down you’re stuck. For us, fewer than ten hourly employees out of 75 have something to do with IG production.”
The equipment suppliers have done a tremendous job of selling their equipment, Hale concedes.
“I’ve talked to a lot of people, and one person in particular who installed a $1 million automated system, had his labor costs go up. He said, in retrospect, that he wished he had waited. However, now that he’s got it, he feels like he has more control over his situation,” Hale states.
Timing is a very critical issue, he points out.
“It’s a money issue too. As soon as it makes economic sense, we’ll do it. If a piece of equipment is viable to make our operation more profitable, we’ll buy it immediately.”
He says there are no cash flow or money issues. “But right now, we don’t have that need. We’re putting more money into [other] fabrication equipment because of our specific market.”
So, what would drive the company to automate?
“Our customers’ needs or there being a demand, either quality or service, that could be better met through automation. But to this point that has not been the case,” Hale states. Another factor, he says, is volume related. “If our mix were to change to the point where we could not adequately staff a three-shift IG production operation and get out sufficient product then we would have to take that step,” he says. “We’re not looking at the exterior of the building. We want the interior. We want the upscale, value-added fabrication business,” he points out.
So each company looks at its situation, takes into account its own individual factors, and makes the decision. For one, it was automation. For the other, the time is not yet right.
Charles Cumpston is a contributing editor for USGlass magazine.
Some Helpful Hints:
Ben Beeler and Matt Hale Speak Out
“One of the things we did during the decision making process was travel to other locations that had the line we were thinking of purchasing and talked with their manufacturing and sales people to be sure this was the product we wanted and the line we wanted. We also looked at other technology options. We looked at options that were more conventional as well as some that were less conventional. We looked at other warm-edge spacer lines. We felt this process and this manufacturing product were the best on the market, and that it was going to work best for our operation.” — Ben Beeler
“If you take an IG unit tempered in a high-volume market, it might go for as little as $3.50 to $4.50 a square foot. You’ve got that huge machine you need to make it, you’ve got two pieces of 70 cent glass that have to be cut and all the labor involved. Whereas you can cut a piece of glass and drill a hole in it, polish it and if your market allows you to supply monolithic, that is more profitable. It’s a luxury we’ve had. We may not always have it, but we have it now. There’s more than $10 billion in hotels, casinos and condos in Las Vegas on the books for the next three years. There’ll be a lot of residual strip centers that will go along with that.” — Matt Hale
Advice from a Pro
5 Minutes with Marcel Bally, sales and marketing director
for the glass processing systems division of Bystronic Inc.
1. What questions should a company ask itself before it seriously considers getting an automated IG line?
• What is the required productivity now? What is the anticipated maximum productivity in two to three years (number of IG units per day, or per 8-hour shift)?
• If already fabricating, where are the true bottlenecks now? Will automation, and the thereby eventually resulting savings in labor, solve the problem?
• Are there quality problems (inconsistency) that could be solved with a consistent, automatic process?
• Automation may reduce some of the flexibility in manufacturing (depending on the chosen concept/technology). How much flexibility (type and size of spacers, handling coated glass, gas fill, type of secondary seal, etc.) will you need to satisfy most or all of your customers’ requirements?
2. How does a company make the decision to automate?
If the above bottleneck (or constraint) becomes unbearable and the company using manual assembly/fabrication can not keep up with demand [or] if the company is forward looking, anticipating growing issues with labor costs as well as uneven quality, resulting from all-manual processes.
3. What is the single most important thing in deciding to have an automated IG operation?
Current and anticipated future market demand.
4. What steps are involved in automating an IG operation? Is it as easy to go from manual production to automated production?
Once the decision is made to fully automate and the line is being installed, the fabricator must insist on a thorough training by the equipment supplier-mechanical operation, software issues, maintenance, etc. Learning to run an automatic IG line generally involves the same time and effort for both, either ex-manual operators or new-to-the-trade fabricators (as long as they know something about glass).
5. What are the challenges a company will face in installing an automated IG system?
Space requirements; the learning curve for the operators until full production is reached (requires higher skill level and technical education than all-manual operators); depending on the technology, accommodating certain inflexibilities in the manufacturing process.
6. What questions should a company ask the equipment supplier when it is considering installing an automated system?
• The company should specify what its market requirements are now and what they may likely be in two to three years (type of product, volume). How will the automatic equipment accommodate the current and the future requirements?
• How will the supplier handle the issues mentioned under 4 and 5 above?
© Copyright 2005 Key Communications Inc. All rights reserved. No reproduction of any type without expressed written permission.