This is a list of USA plastic mold buyers’ suggestions for how to purchase a well-made plastic mold.

It is a known fact that plastic molds are a commodity. The injection molding industry has become all too familiar with this statement as it has become the dominant attitude toward hiring employees that do not understand the complicated process involved in injection molding. Due to my experience both selling injection molds to buyers and buying injection molds as a purchasing manager, I can offer some insights that may be useful to those in the buying and selling of molds.

Answers to six questions

The role of mold buyers is either to implement a successful manufacturing process or to ensure that the company loses profitability. Buying the wrong product causes productivity to suffer. A mold must be evaluated based on more than price and delivery. It is not possible to calculate the best mold price from part size, number of slide actions, steel type, and location of manufacture using a spreadsheet. This is not a straightforward process.

These six questions should be answered by purchasing managers in order to maximize profit and improve their purchasing skills.

How does an injection mold work?

Plastic that has been heated and cooled into a part. Recycling times are faster when the heat of the melted plastic is dissipated from a mold quickly. Which products do you sell? Press time. It is my goal to find suppliers who can design and engineer cooling systems and melt delivery systems to reduce cycle time, scrap, and waste. The mold cost can arise from time to time, but through two simple justification tools, cycle time and scrap reduction, the cost can be justified.

There are also several other factors that impact the total cost and performance of a mold, including the size of the mold, the number of slide actions, the type of steel, and the location of the tool. When you work with the tool engineers or suppliers, you can learn more about what you are buying and how to justify costs. It is possible to increase profitability and productivity for the company if the mold is purchased at a higher price.

Do you use many suppliers?

In order to increase my buying power, I reduced my supplier base. My supplier can provide me with a package of tools that fits my needs and reduces my costs. At EIG Industries, a tier automotive supplier and medical molder, when I started as a purchasing manager, there were more than 40 approved mold suppliers on the premises. By my efforts, this number was reduced to 18. My approval process was based on the types of molds each supplier was best at the building, as well as their location.

I am able to negotiate the best balance of price, quality, and delivery by sourcing the supplier’s sweet spot. When I joined EGI, I was responsible for a $5 million tooling program. My tooling budget was cut by $50k or $450k because I purchased the right molds and sourced the right tool packages.

Are you on time with your payments?

A reputation for paying on time is another way to reduce costs. The supplier is at greater risk of not receiving payment on time, which could lead to the need for bank financing. Your best option is to negotiate a cost-down with your suppliers for prompt or early payment. The cost reduction should be around 2-2.5%.

Does your company need extended payment terms?

Due to the fact that we need to expand payment terms to increase cash flow and EBITDA, terms are difficult. Nevertheless, we have other options. Large, financially stable shops are capable of offering extended payment terms. In comparison to United States mold shops, Canadian mold shops are able to obtain government insurance on receivables through Export Development Canada. The shop can now obtain better interest rates and greater credit lines due to the reduced banking risk. Factoring the receivables to a bank that knows the automotive tools design process is another way to get extended terms. By using this process, I reduced the initial tool costs, which helped to offset the factoring costs. The results were positive for the company as well as its suppliers. Your finance team and your suppliers can help you come up with a solution that meets your needs.

How long will your supplier be in business to meet your needs? Is the business healthy?

When a mold is being built, the last thing you would want is for a supplier to go out of business. Manufacturing molds is a challenging business. A mold builder is disliked by banks because they are hunters and gatherers who don’t know where they will find their next job. Financially healthy suppliers should be empowering their staff, investing in the future with training programs and apprenticeships, and having a succession plan. Taking into account these factors will help you determine if a business is properly managed or if they are being managed by the business, which is never a good idea. Mold builders are often privately held, so finding out these details can be a challenge, so I recommend getting to know their owners and executives.

Which supplier should you choose?

A number of factors influence business award decisions. In addition to price, quality, and delivery, a Pugh matrix is used to construct a selection method that takes into account the supplier’s experience, the company culture, financial health, and the supplier’s ability to meet my requirements. When I choose one supplier over another, I can be objective about my decision-making process and give a quantitative reason for my decision.

Hopefully, by following some of the above recommendations, you can lower your mold costs while increasing the strength of your supplier relationships.