Do you wish to understand how to choose a GRP pipe production line, immediately obtain maximum profit and minimize the risks?
LEARN HOW TO CHOOSE YOUR FILAMENT WINDING PLANT
If your intention is to maximize your return on investment in the composites market, utilizing a filament winding technology, and you want all the elements necessary to accurately evaluate every phase of the decision chain, then this article is indispensable for you. It is important for you to know that at present, only half of the entrepreneurs involved in the production of GRP pipes are able to sell at levels that are equal or superior to the original average objectives.
Unfortunately, this is happening because they have got a CFW Plant that does not allow them to be competitive. This can be due to the high scrap during production and the impossibility to reduce it. Or due to the non-accurate raw material dosing and even worse due to the fact that they are producing with recipes or processes that are not optimized. With such initial conditions they surely cannot reach their cost targets.
This data is evident in the most recent and accredited studies, and on a worldwide scale in this sector. Furthermore, the most disconcerting fact is that the world’s economy can be defined as significantly unstable.
Benefit from a rapid return on investment through profit maximization.
However, it is also true that companies that achieve their objectives are able to enjoy millions of dollars in profits simply by overcoming difficulties. They were probably fewer than those which exist today, but they are in any case increasing continuously as we speak.
If you feel that your company has the potential of entering the GRP pipe production market and you want to ensure that you benefit from a rapid return on investment through profit maximization, then keep on reading about:
- the steps you need to take to choose the correct CFW (Continuous Filament Winding) plant with the right capacity, avoiding futile, elevated investments and ensuring that every dollar invested will generate profits;
- the positive and negative consequences of decisions taken by some companies worldwide, in order to learn from mistakes made by others and to not fall into the same traps yourself.
Initially, I asked myself:
How come some plants operating in the same sector, with the same product and with the same raw materials, enjoy elevated success whilst others battle to survive?
After years of analysis, and experience in the field with over 40 plants in many countries, I can confidently say that in the filament winding world, the difference between success and failure does not only depend on a single decision. It depends on a series of decisions taken in a different manner and at different moments during the decision chain. These decisions also have to be taken in the correct sequence. You should always bear in mind the final objectives that you want to achieve.
The type of the plant
The first question that you need to pose to yourself is:
What type of plant should I purchase?
There are various choices one can make. For example, there are plants related to the production system, be it Discontinuous, Continuous or Centrifugally Cast, and for each production system there are variants.
I have drawn up some statistics of the request for quotations which I have received through the years for CFW plants, in order to understand how many of the sold plants were actually a true reflection of the original production system and/or configuration envisaged.
The finding was unbelievable: only a mere 5%.
Let us look at an example:
Years ago, an important company invested heavily in an extensive composite pipe and tank production line, including know-how for the testing of the products.
During the negotiation, and not having any detailed information like the one indicated in this report, the entrepreneur concentrated all his efforts on obtaining a price reduction. Afterward, he finally decided to sign a contract with a renowned supplier of CFW lines.
The consequences of an incorrect decision
The same entrepreneur phoned me two years later, asking for a consultancy service because his company was continuously losing market quota, since his plant was unable to supply pipes with a higher-pressure range. When I analyzed the problem, it was clear that he would have needed a higher-pressure range capacity right from the outset, because the terrain in his country has extreme changes in level which required high-pressure systems. The turnkey tenders required at the time, and to this day, called for high-pressure certifications, which he did not have.
His request was for the implementation of the production “know-how” and offer assistance for the certification of the high-pressure classes. After I had carried out an audit of the plant, I found problems that to be confronted and resolved before the transfer of the said know-how for the higher pressures. Furthermore, all the downstream and testing equipment had to be modified in order to prepare the complete line for the upgrade, implying costs that much higher compared to those which would have been associated with a correct initial evaluation and investment.
If the right decision would have been taken from the beginning, the savings would be higher than 1 MIO USD
Analyze before purchasing
This is a typical example of an investor who, in good faith, followed the incorrect advice offered by the supplier and now he is the one that has to face the market.
So, in order to respond to the question of what type of plant I should purchase, you need to analyze two aspects:
- Initially, in what type of market you want to position yourself. For example the civil infrastructure market, industrial market, marine or oil & gas market, or a combination of the said. Defining of this market will help you to understand the product demanded by this market segment and consequently choose the production system;
- Based on the market you will choose, it will be important to understand the maximum and minimum diameters which are most requested and what the future demand prospects are for the said.
We can generally say that the marine, industrial and oil & gas markets demand small quantities of pipe, of medium to high pressures and with particular technical characteristics. Generally, the pipes need to be produced with the discontinuous filament winding system. This concept is also applicable to the civil infrastructure market but is related to very small quantities and medium to high pressures.
If extensive lengths of pipelines are needed for civil infrastructure projects (over 1000 km), a CFW production line is recommended. Also because the cost of produced pipe is 15-30% lower compared to that produced with a discontinuous or centrifugally cast line. If small quantities and low pressures are mostly called for by a particular market (for example sewer pipes for small works), a centrifugally cast line can be chosen, even though this system does not offer the flexibility of a continuous or discontinuous system.
Three aspects you need to evaluate while choosing the pipe production and testing machines.
I will now focus on the civil infrastructure market, for irrigation, potable water distribution, water feeding lines for hydroelectric power stations, etc. I clarified earlier that for these projects, the recommended system is a continuous production line, be it for its high efficiency, or the lower costs of the finished product.
New questions arise when one has to understand how this line should be configured, after receiving a multitude of answers and motivations by the suppliers of such systems.
I will spread some light on the last issue in the last part of this article.
Let us make one concept very clear – a continuous pipe production line is composed of various machines:
- Pipe production machine;
- Ancillary machines for “off-line” processing;
- Laboratory machines for destructive testing of pipes;
- Pipe and sleeve hydro-testing machines.
When choosing the pipe production and testing machines, the following three aspects have to be evaluated:
- The diameter, the stiffness rating and the maximum pressure rating of the pipes that these machines would produce and test, with the necessary fit-outs and tooling;
- The necessary fit-outs to carry out the testing of the various diameters of pipe;
- The efficiency of each machine.
Before we go into specifics, let us look at an example:
If a supplier offers you a CFW 300-2600 line, equipped for an AWWA range of 600-2000, it means that the production line could produce all the pipes with a diameter range which falls within this diameter interval of 300 mm to 2600 mm. The fit-out equipment which will actually be supplied for production and testing will only cover the following diameters (in mm):
600 – 700 – 800 – 900 – 1000 -1200 -1400- 1600 – 1800 – 2000
Understanding this concept is very important because the diameter range capacity that this line should have is determined by the future prospects and demands from your particular market segment. The fit out range depends on the current market demand and situation.
Not having enough information leads to investment failure.
Seeing that the delivery lead time of a single fit-out is relatively short (a couple of months), it is convenient that you accurately choose the initial fit-out configurations, based on the current diameter demands, thereby reducing the initial investments substantially, purchasing other diameters only on a new project basis.
Once the capacity range and current demand fit-outs have been chosen, the third task is that of carefully evaluating the know-how which has been included in the contract (if any), the pipe designs and recipes, pressure and stiffness ratings relative to each diameter, the basic certifications which will allow you to immediately start with the industrial production of sellable pipe, as well as the necessary equipment to optimize your production plant and logistics related thereto.
This task is particularly intricate and critical, so it is extremely important to have as much information as possible, before purchasing anything related to the FW technology, because any mistake in this phase will put the complete investment at a high risk of failure. You could easily get in a situation where you invested in a complete plant but you cannot get the contracts due to the pressure range, or because you must increase your prices to cover the scrap costs or Plant inefficiency.
If you want to avoid that:
- The pressure range of the tenders is higher than the pressure range included in the Know How you have got
- The lower productivity of your Plant force you to increase your selling price or decrease your profits
- You have invested in equipment that you will not need for the first years so you realize after some time that a big amount of money is blocked in such parts
- The type of fittings that your market requires are not included in the Know How you have got.
- The pipes recipes are too expensive
But all these risks can be avoided through a suitable analysis of your market and your investment.
I am ready to have a conference call with you, completely for free, to clear your initial doubts on all the aforementioned issues and tasks before you do the next move to avoid putting the complete investment in a high risk of failure.
To rapidly and easily book an appointment, all you need to do is click on the button below.
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