Setting up high volume operation

[the corp]

I've been asked to set up an operation that will
give me the capacity to frame from 10,000 to
30,000 frames per month while keeping the unit
cost under $15/ea. We will be doing runs of
identical frames in quantity from 500 to several
thousand.The largest size would be around 18 x 20.
Conservation is not an issue. How would you go
about this? Can this be done?

[Marc Lizer]

Let's try it this way.

First: You tell The Grumble what you already know, and what you think you have to do. Then we can go from there.

Second: As you would/should already know, any answers will be dependant upon certain assumtions. Please fill in assumtions or capital investment, proposed shop size (and estimated rent/expenses). Please inform if equipment needs to be purchase/leased, or if it is already acquired, or owned.

That will be a good start . . .

[FrameMakers]

I don't think this can be done in the U.S. at least not with legal workers.

[Ron Eggers]

Maybe this should be called The Custom Picture Framers Grumble.

Not many of us here would know how to produce 30,000 frames/month. I myself have done that, but it took 25 years.

And if you've been reading anything here, you should know that conservation is always an issue - even when it's not.

I'm not trying to be unkind, but ask us something easy, like how to get 5 16x20 mats out of a 32x40 board.

[the corp]

So far: if the frames outer dimension is 20 x 24
I could get about 100 on a 40 x 48 pallet. Figure
4 frames per tier to about 48" high if allowing 2 inches in height with the frames stacked this would hold 96...round it to 100 per pallet. At
Full capacity this would mean 300 pallets to hold
30,000 assembled frames. line them up 15 pallets
by 20 pallets allowing a 1 foot buffer this would
measure about 75' x 80' = 6,000 sq. ft. to hold
30,000 finished frames. Double that number to hold
matting, glass, foamcore and other materials.
Now we have 12,000 sq. ft. to hold materials with
some room to work. A 40'x 50' assembly room adds
another 2,000sq.ft. A cutting room that is 40'x25'
would add another 1,000sq.ft. We also need room
to house the moulding...It would take 300,000 linear feet of usable length to make 30K frames
where 1 stick of 10' would be needed for each.
If there is 500 feet per carton and the cartons
are 12" x12" x 10' and there were stacked 10 ctns
wide by 4 carton high these would take about 80'
x 60' or 4800 sq.ft. to hold 400,000 linear
feet of moulding. 400,000 linear seems a reasonable amount of onhand stock for producing
30K frames in a month. So it would take:

300 pallets of finished frames = 6,000sq.ft.
space to hold other materials = 6,000sq.ft.
area to hold linear moulding = 4,800sq.ft.
assembly room = 2,000sq.ft.
saw room = 1,000sq.ft.
-------------
19,800sq.ft.
Total 20,000sq.ft
This space is available for $10,000/month
utilities included.

320,000 linear ft. x $1.00/ft = $320,000
matting,glass,foamcore 75,000

To make 30k/month
we have say 20 work days/mo
X 2 shifts 8hrs./ea
would have to make about 1.5 frames per minute.
How many people/machines would we need to
produce 1.5 frames per minute???

At breakeven there would be about 45,000 left
to pay wages per month.

Also need to buy equipment:

Computerized mat cutter 40,000
Double miter saw 15,000
vnailers xxxxx

That's what I know so far.

[FrameMakers]

The way I see it you need

1 saw operator
1 runner
2 frame joiners
1 stacker

1 mat cutter
1 mounter
1 glass cutter (if you need to cut glass)
1 runner
5 fitters
2 packers

1 shift manager

Thats 17 per shift.
Also remember you don't get 8 hours work out of an 8 hour employee. DOn't forget to figure in workers comp, unemployment, vacations, sick leave,
potty breaks,etc..............

38 employees at $12 per hour actual cost is $72960.00 per month.

[jframe]

That would be 17 workers at poverty level wages.

[Dermot]

Omga http://www.omgainc.com/ make a auto mitre cutter, model V2015 NC capable of producing more than 4000 mitred pieces per hour this machine will cut section sizes 50mm x 35 mm with a maximum length of a 1000mm…..allow for extra space for this machine…..if I recall correct the foot print is about 30 x 20ft…..or close to that….I once saw this in operation at a framing trade show in the UK quite impressive.

You can buy your glass pre cut…..I suspect that your production sizes would warrant direct shipment of glass from the factory in China….this will arrive in most cases very clean so your glass cleaning will be minimal…..your big consideration will be handling the cases/pallets of glass….tricky at first but you will get the handling down to about 10 minutes per case after a bit……there are 20 to 24 cases of glass per 20ft container about 48,000sq ft per container……allow about 1000 to 2000sq ft for glass handling.

At your volume you can outsource some of the operation….ie have your backing pre cut at the mill or by your supplier…..why not outsource the mount cutting….talk to the mount board guy’s…….ask all suppliers what they can supply asides from their standard lines……you will be surprised.

This is a great opportunity to stretch the goals of a framing production unit….you need to think beyond a typical framing operation……if it were me setting up this unit I would find one of the best furniture manufacturers I could or a window manufacturer…..and ask them if I could have a look at their production lines…..and take the best elements of their operation and apply it to the framing operation…..at the very least they will spark your imagination.

Good luck with your venture……it can be done…..I’m afraid I will bore the pants of people talking about my favourite company…..Dell……anyway …..here is another bit of information about Dell…..the production unit Dell have in Ireland for EMEA (Europe, Middle East and Africa) is best in class worldwide….they beat the pants of all the production units Dell have in the US, China and Malaysia………and have done this for quite a few years now……and to boot….Ireland has now out passed the US when it comes to earnings/wages…..I know you are not setting out to be a Dell……but you could apply quite a bit of their supply chain management to your operation…..many small companies in Ireland are now putting some of the Dell practices into their operations ……..the results are that jobs that would have been lost to Ireland are staying here……..and the cost bases of the business are dropping…….without wages suffering…….

Anyway……once again good luck with your venture…….Oh….and welcome to the Grumble.

Rgs

Dermot

[ 11-06-2003, 05:18 PM: Message edited by: Dermot ]

[JFeig]

Based on 30,000/20 day month/ 2 shifts that is 750 frames per shift. 17 people might be a little short at that level.

What about miscuts, damage and reworking? Who will be doing Q.C. inspection? There is a learning curve to each task as well as a probable problem with retention and A.W.O.L.'s in this factory atmosphere. Check with the auto or any other industry.

I can cut 100 8x10 mats per hour. Can this rate be sustained for an entire shift, five days a week? Who is going to precut the mat to blank size? Or is the machine going to do gang mat cutting?

Glass in those quanities should be able to be received from a glass supplier precut.

I am not trying to be to negative, just relistic in starting up such a stressfull program.

[FrameMakers]

I also saw an automated machine at the Atlanta trade show a few years back.
You loaded the length moulding on a vertical conveyer and took finised frames of the other end.

It took forever to get the thing to make a good frame but as soon as it was calibrated, it realy moved.

[the corp]

Hi Dermot, Hi Jerome
Thanks for your suggestions.
Doing this successfully means many areas
and many ways of doing business will need close
scrutiny. thanks for your help!

[EllenAtHowards]

My only question is: How long will you be doing this before the company for which you are doing the work takes it offshore for $10 a unit?

[wpfay]

I saw a frame assembly machine in Atlanta that cuts and assembles the frames. Would save on additional labor and redundant machinery, though I expect the reality is that you would have other joining and cutting machinery as backup. 15K is much too low for a saw that will handle the capacity you want.
The CMC is the same deal. For your needs, better figure on about 60-70K for a two station Gunnar or Zund CMC.

Figure maintenance costs and down time as well, especially if you don't spend the money up front for high quality machines.

Interesting exercise though.

[JFeig]

Those automated machines are in the $250k price range. One machine for cutting 4 sticks of moulding at a time and the other for joining.

As I remember the cycle time was in the neighborhood of 4-5 per minute.

[ERIC]

Are these just the frame? without any art in them?

I hope that you are dealing with more than a one customer for your product.

[Jim A]

Don't forget about the cost of shipping and packing materials. Is the customer paying for shipping or is it prepaid. Do you have to warehouse the frames for them or is it just on time manufacturing. Have given you firm production numbers or will they vary by the season. If there are slow times can you cover the wages to keep people on who are trained. Looking to hold the price at about $15 with largest 18X20. I this the average cost per unit or is it for the largest size. I would talk with a manufacting or cost accountant. To much info is still missing to say if it will work or not.

[Jim Miller]

Your location is given as "southwest". Mexico is southwest.

Go there and set up at a fraction of domestic cost. That might be the best start unless the language barrier, shipping, tariffs and other border-crossing expenses would drown you. Or unless your customer requires domestic production.

Ellen brings up a good point. How committed is your customer to your operation? And after the investment of $big, what happens if his market research is wrong and the frames don't sell? It happens.

This sounds like the rumored WalMart deal a few years ago. Notice WalMart isn't big in the framed art business. Be careful.

[realhotglass]

Originally posted by the corp:


snip

300 pallets of finished frames = 6,000sq.ft.
space to hold other materials = 6,000sq.ft.
area to hold linear moulding = 4,800sq.ft.
assembly room = 2,000sq.ft.
saw room = 1,000sq.ft.
-------------
19,800sq.ft.
Total 20,000sq.ft
This space is available for $10,000/month
utilities included.

320,000 linear ft. x $1.00/ft = $320,000
matting,glass,foamcore 75,000

snip

As Jim A touched on up the thread a bit, using JIT management for stock in and out, you can reduce your storage requirements greatly.

[Elaine]

Corp,

since you have been "asked" to set this up, is the person(s) asking interested in backing you in the setup with low interest loans or partial investment?? An investment for a piece of the business - more of a partnership?? This would give them a vested interest in the setup and the success of the setup. I have seen this done here in NY - a company was interested in the success, availability, and production of the product, so they floated a loan for the expansion of the business with a low interest loan paid over time. It could help save the work from going across the border or overseas. I have also seen a sole source supplier in mexico almost bring a product to its knees because of financial problems and they couldn't produce the part that went into the final product - the company sent employees to live and work in mexico to get the parts produced and out of mexico so it didn't cripple its production. I don't know about the rest of you, but I'm tired of seeing manufacturing leave our state and leaving people out of jobs - United Technologies just did that in Syracuse, NY - 1200 jobs - gone, company has been there forever.


I would also suggest that you visit at least one operation that already does this type of volume production as part of your research. Gives you more meat to chew on :D OR, maybe you could partner with the place you visit and not have to reinvent the wheel... just some creative thinking since the power is back on and my brain is not in a freeze!

just some thoughts

elaine

[gearold]

Corp,

I have set up several large volume shops from
4-6000 per month up to 35000-40000 per month.

From what I ve done you would have around 10-12 employees (payroll 25000-30000 per month)
based on 30k per month for every 10 k less you could manage with 3 less employees. you could have a 5000 foot work area set up in a production line format. The last shop I worked with does 200 frames per hour on average 30-40000 per month.
Here is the equipment they have

2- saws Hydramatic operated
2- nailers
1- cmc
as far as cutting & assy goes, have done up to 50k frames per month but they had 3-4 temp workers.
It can be done Volume framing like you speak of it very profitable, but you must keep your quality control .
If you need some help with this give me a call or email I will see if I can help you .

gearold

[Roxanne Langley]

Another person you might talk to is, Jim Parrie in New Orleans. He gives some classes at WCAF each year and if my memory is working this morning I believe he has a high volume framing class. But anyway, he helps people set up OEM's all over the world. Might be a contact you could use,

Roxanne
Langley House Gallery
Spring, TX

[Terry Scidmore CPF]

Excuse me for being pretty dense and slow, but I don't think that I saw anything mentioned about saw blades, saw sharpening, time to change saw blades (and you will be changing them a lot for this many frames), ventilation for the saw area, sawdust containment and disposal, etc. Also didn't notice anything about these issues in regards to the CMC area - changing blades, paper dust accumulation, waste disposal. And you know, it takes a little bit of room to swing around a ten or twelve foot stick of wood. And what about the garbage bill? The cost of electricity, heat, airconditioning? Inspections? Parking for the employees? Lunchroom? Lunchroom furniture, regrigerator, stove, microwave? Let's not forget bathrooms either! Then there is toilet paper, towels, soap, cleanser, aspirin, first aid supplies, first aid station, first aid training, hazardous waste training, telephones, computers, fax machines, forms, furniture for these items to sit on, employees who don't show up for work, employees who show up and don't want to work, employees who get sick on the job, employees who get hurt on the job. . . . . .

[Framerguy]

It amazes me that somebody comes on this forum from the "southwest" and wants to know how to set up a volume operation that will build over 350,000 readymade frames each year (how many of the end users of these frames would have been potential customers of YOURS???) and you are all beating each other up to be the first to post more "useful" information on making this project fly!!!!

I have a better solution. Lets multiply $5.4 million in potential wholesale annual gross sales by a developer's commission of, say, 10% of the first year's projected gross sales, and divide THAT up amongst those participants who want to crunch the numbers on forming a manufacturing business that will replace some portion of our yearly profit from framing customers with some cheap readymade frames. I would say that $540,000 divided up with 10 or 15 Grumblers who wish to contribute that type of information should make it alot more worthwhile, don't you??

I sure would like to sneak onto the Microsoft forum and ask Bill Gates and his crew to help me with a venture that would potentially cut a slice of THEIR pie off in my direction!! I am quite sure that Bill and the boys would bend over backwards to help a perfect stranger take a little chunk of profit out of their corporate entity! Just simple stuff like where do I go for computer assembly in China and who do I buy the component parts from in Taiwan that are the cheapest, ya know, little stuff that wouldn't harm their overall business ......... much.

Yeah, I know, readymades aren't a threat to a "custom" framer!

I wonder how that will wash when more readymades are offered in more sizes by more little independant readymade companies that WE helped to get started. And they realized that there is a BIGGER market out there if they offer readymades in 1" increments!! Or worse, one day production on request to ANY size the customer needs!

I just am looking at what y'all are helping to do for yourselves here.

Framerguy

[realhotglass]

[QUOTE]Originally posted by Framerguy:

[QB] <snip> and you are all beating each other up to be the first to post more "useful" information on making this project fly!!!!
<snip>
I wonder how that will wash when more readymades are offered in more sizes by more little independant readymade companies that WE helped to get started. And they realized that there is a BIGGER market out there if they offer readymades in 1" increments!! Or worse, one day production on request to ANY size the customer needs!
----------------------------------------------
And here are a couple more good suggestions. :D
Although I don't think the second one is too feasible.

Seriously though, I wonder how many posters did make 'helpful' suggestions with big figures trying to disuade the corp.
It is a frightfully big leap, and as pointed out in numerous posts, putting all your faith in ONE customer is a huge risk, especially if it's you outlaying $(insert obscenely big number here) . . .

It was quite amusing to me to see the analising corp did in his second post. Boy have I done some of these for US inquiries for my products !
Makes yer head spin a bit :/

Have a good one !

[ 11-17-2003, 05:55 AM: Message edited by: realhotglass ]

[Dermot]

Quote
I wonder how that will wash when more readymades are offered in more sizes by more little independant readymade companies that WE helped to get started. And they realized that there is a BIGGER market out there if they offer readymades in 1" increments!! Or worse, one day production on request to ANY size the customer needs!

Framerguy

You are right on the money……the day will arrive that ready-mades will compete with quite a big proportion of the custom made market……….rather than wasting time moaning about the possibilities of this happing……if it were me I would be putting my thought process into how I can capture a piece of this new and emerging market…….this has happened in other market lines, I have being laughed at when I have compared the computer business to custom framing……have a very close look at what Dell have done……..and then compare the custom computer manufacturers/resellers of 10 to 15 years ago……”if you can find any left”……..another indicator of the shift in the custom framing market is the amount of shops moving into the reselling of gift products in their shops…….perhaps some of what is being sold as custom framing today should be shifting to the gift/readymade market sector !!!!!……….just because one might have the view that something should not happen does not mean that it won’t happen…….the fact that you have posted about the possibilities that some custom framing will shift to ready-mades would indicate to me that your analysis of the market place is that a shift is underway………..interesting times….

Rgs

Dermot

:rolleyes:

[ 11-17-2003, 07:09 AM: Message edited by: Dermot ]

[Elaine]

Gee Framerguy!!

All of the "Help" doesn't really amount to much more than all of the "help" that you all offer on a frequent basis to your direct competition - us "Custom framers" :D

Watch out, I might come down and set up operation right next to you - you've told us how it is to move our operations :D ;)

sorry, devil made me say it!

elaine

[Framerguy]

Elaine,

You are more than welcome to come on down and open up an operation next to me. Right now I have an insurance agent on one side of me (not much help in sending customers my way) and a florist on the other side of me (she sends a few my way). Maybe we can strike up a symbiotic relationship and both benefit from our businesses.

I would invite the competition and would do my best to help you get started. You'd be surprised at the variety of framing operations down here. Most are rather generic in nature and don't do much in the design area of framing. I may well have more business than I can handle on the "custom framing" corner of the market if I can hang on long enough to get my database built up.

It's a real bummer when your name doesn't come out in the phone book until late this coming winter! You need to be prepared to beat the bricks to get your name out there unless you time your move to the deadline for the listing in the YP's. I don't do any advertising in the YP's other than the one liner that they give you but it is rather difficult if you don't even have THAT to fall back on!

Framerguy

P.S. That WAS a theoretical situation that I cited at the end of my post. But stranger things than that have happened in all walks of business over the years.

[ 11-18-2003, 12:07 AM: Message edited by: Framerguy ]

[Elaine]

Framerguy

I can empathise with you on missing the yellowpage listing - even the one liner (all that I do) - I missed it when I first opened and went from Sept - April with no listing. I did do some creative PR, maybe some you have already tried, but I'll give you a list anyway:

1) Press Release to local papers, business trade newspapers
2) Contacted local paper for their "business spotlight" - free and they did a photo and article - best business boost I had and the most response from the readership.
3) emails to the local newspapers "storefront" columns
4) our chamber sends out a monthly newsletter and we could add a flyer to the mailing for free as long as we provided it and it didn't increase cost of mailing
5) local chamber website - placed ad/link from the site for $50 a month
6) posted flyers in postoffices, hardware stores,etc. that had public bulletin boards
7) gave cards to parents and friends to hand out if the topic came out - my parents have been my best sales reps!
8) I signed up with the local newspaper that offered a special "brand builder" ad that reached a large targeted population for approximately $55 per ad run - a little bit bigger than a business card size, but packed a lot in and was reasonable for an ad in this area.

I know you've been in business before, but these are some of the things I did in the beginning. I worked in a marketing dept for a while, and one of the things they pushed was doing as much marketing as you can for FREE - which was basically for them the Press Releases.

Hope this helps a little smile.gif

Will you be at the Florida show?? I am going to be there this year for one day, we are visiting my inlaws in Jupiter and are going to go for a day - maybe I'll see you there

elaine