Professional Development Meeting
Market Place from a Plastic Injection Molder's Perspective
March 8, 2011
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What You Missed

Market Place from a Plastic Injection Molder's Perspective

Like many manufacturers in the US Recto Mold faces many challenges ranging from the struggling economy, domestic consolidation in the industry, competition from low cost companies overseas, high energy costs and more. With over 46 years of experience in the injection molding industry Per Flem has met the challenges with innovation and a thorough understanding of the industry. While only a small company their success can be contributed to their acceptance of change, understanding their abilities and being proactive in controlling costs and diversifying their product offerings.

Per presented some history of the industry and some recent events and trends that have affected the overall industry. While many companies have closed, as many as 30% in the past 3 years, Recto Mold is still competing by focusing on fast delivery, reasonable prices and diversification. They have been able to control their cost by investing in newer injection molding machines which use on average 2.8 kws vs older machines that would use an average of 13.6 kw, adding robots in areas that were labor intensive and by going green, adding 144 solar panels to the roof of the building. The decisions to make the capital investments was aided by state and federal grants that helped reduce the overall cost by as much as 75%. Not only are the new molding machines much more energy efficient but they also contributed to additional electrical efficiencies when their heating and cooling systems were used to help heat and cool parts of the building.

The diversification of Recto starts with actually selling the new energy efficient machines in the US. They are an authorized dealer for some of the machines. Some of the new products that they helped develop are an oil gauge used in most fast food businesses (tells when frying oil needs to be changed), a device called Energy Spy which lets you know when the electricity consumption, or phase, of your business is in compliance(there are large penalties if your out of compliance) and a device that lets molders know when there is excessive leakage of the molten plastic at point the nozzles meet the tool. Per continued his discussion with some of the cost factors in the plastics industry going over various materials and their cost drivers. With oil going up so much recently you would expect resin prices across the board to follow. Although oil is a big part of the cost, natural gas accounts for 70% of the overall cost of resins so it follows natural gas price to a greater extent. Another cost driver is the automotive industry since it can create a huge demand for various plastics. It is good to hear of a success story and one here in our back yard. I thought the meeting was interesting since I use to buy plastics and actually bought one piece from Recto. If steel is your thing then make sure you come to the meeting in May.