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July 1, 2001

7 Min Read
One saga of Asian tooling: Salvaging a program gone bad

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Poor component steel in thin-walled sleeves caused the failures seen here.

It was, as Keith Farnham describes it, his year of living dangerously. But, perhaps more importantly, it was a year of lessons learned for both molder and client. 

The saga began with an RFQ for a 21-mold package received by Bermo Inc. (Circle Pines, MN), a custom molder and metal fabricator. Farnham, a mold manager for Bermo, quoted the job, but didn't get it because of the OEM's need for a six-week turnaround. As is typical with new product development, the OEM had lost a lot of time with upfront design changes that had significantly narrowed the mold build window. 

A company in Taipei, Taiwan said it could deliver the molds and molded parts in the time required, and the job was off to Asia. 

Unfortunately, when parts began arriving at Bermo for assembly with the metal-fabricated components it was producing, quality was poor. "There was gate blush, flash, and pin push," says Farnham. "And these are highly visible, cosmetic parts." 

To solve the problem, the customer enlisted Farnham to go to Taiwan to evaluate the tooling, take photos of all the molds, and arrange to have all 21 molds shipped back to Bermo, which would take over molding the parts. 

Bad Mold = Poor Parts 
After arriving in Taiwan, Farnham quickly discovered the underlying reason for the poor quality of the parts: the molds. Upon inspection, Farnham could see that the mold designs were faulty and that there was no consistency in the mold build. The reason for this lack of consistency was discovered upon visiting the various shops involved in the project. For the 21-mold package, Farnham estimates that there were 30 to 40 small mold shops contracted to work on the tools. 

"Basically, the Taiwanese company could give such good lead times because it threw people at the job," says Farnham. "They've got nothing on us in the way of technology and equipment, but what they do have is people. It's their biggest resource." 

The shops in Taipei involved in this project were beneath U.S. standards, according to Farnham. "There are hundreds of these little one-stall garages everywhere," he says. "They have dirt floors, little in the way of equipment, and the people work in deplorable conditions." 

The biggest problem, according to Farnham, is that these Taiwanese shops hadn't perfected mold design very well. "Each mold ran the gamut of design schemes," he says, and there seemed to be no rhyme or reason for each design choice. With so many different designers and shops involved in the work, the variation that resulted was inevitable. Farnham also found that much of the cost savings in this particular tooling package was realized through the use of substandard mold components. 

Additionally, few records or databases on the tools were kept, making it difficult to determine and fix the various design problems. 

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Bad design and substandard steel caused these cams to split in identical locations. The use of EDM without polishing also resulted in poor finish on many components. 

Lessons Learned 
When Bermo got the tools in-house, it had to reverse engineer the molds to assess construction. It took the company hundreds of hours and cost the customer tens of thousands of dollars to get the tools in shape to run decent parts, says Farnham. 

"Ultimately, the customer lost time and money, and we didn't make anything on the job," says Farnham. "I doubt very much that the customer will go offshore again." 

The real problem, says Farnham, is that the incentive to cut costs is so great with OEMs today, that the cheap prices they see on tooling quotes from offshore shops is almost too much to resist. Additionally, people making the decision to go offshore are often not moldmakers or engineers, but accountants or managers who haven't a clue about the critical nature of tooling necessary to produce high-quality products, he says. 

So, how do U.S. mold shops compete in this global arena? Contrary to the prevailing strategy of putting more time and effort into design, Bermo's strategy, says Farnham, is to reduce the front-end hours. The company focuses most intensely instead on production and the mold build. 

Concurrent engineering is one way to help alleviate some of the time pressures in the mold build. It's important to integrate the CAD side of the business with the CAM side, says Farnham. 

Beating the offshore competition at its own game

Taking an example from the Asian strategy of pulling together multiple tool shops and "throwing people at it," a group of U.S. toolmakers is taking the team approach. Midwest Mold Builders (formerly Midwest Tooling Assn.) is a consortium of 17 moldmaking companies in the Minneapolis-St. Paul area that promises to beat the Asian competition at its own game by combining speed with consistent quality. Together, the companies represent $40 million in annual sales and have more than 200 toolmakers. Individually, however, member shops are considered small (only two have more than 40 employees); therefore, their exposure to large tooling packages is minimal. By joining forces these companies can offer capabilities that a single member shop can't offer on its own.

"Speed is easily attained due to the availability of any given tool shop to start on a mold immediately," says Scott Wahl, former owner of Global Tool & Engineering, who heads the consortium. Capacity is never an issue, he adds. 

Midwest Mold Builders is organized on the premise that mold shops can be more successful as a group than they can individually. Many of the shops in the group already use each other's services, but the association pulls them together formally. Wahl acts as a marketing and sales representative for the shops in the consortium, working to pull in large tool packages that can then be divided up among the shops. 

Wahl believes the group will be successful because each shop within the association has its own niche. "Every new mold has a perfect fit for someone within the group," he says. 

Though shops are not obligated to submit RFQs to the group, there is a definite advantage for large mold packages. For example, one member recently received a package of 25 molds to quote. Although it would be impossible for this one shop to build 25 molds in the required lead time, the owner realized that as a group, the job could be accomplished. 

Generally, Wahl receives the RFQs for large tool packages and then regulates which shops will be involved in the project. This decision is based on shop size, current workload, niche capabilities, and the insights of Wahl and his engineer. Once the shops for the project are chosen, representatives from each meet with Wahl to go over the specifics of how the job will be quoted. The package is split up among the shops at this point, allowing each to work directly with the customer on its portion of the overall package. Wahl is responsible for ensuring a consistent tool build for the overall project. 

"Since the customer works directly with each shop, there are no additional markups to pay," says Wahl, who receives a commission. 

All molds are tested and samples are submitted and approved before shipping a mold. "It's a unique way for OEMs to have a large tooling supply base, and get molds rapidly built and tested." For the moldmakers, many of which are held captive by local molders, this team approach opens them up to large tool packages for which current customers wouldn't consider them because of their size. It also allows them to reap the benefits of having a salesman pushing their services—something on which many small shops don't spend money.



Contact information
Bermo Inc.
Circle Pines, MN
Keith Farnham
Phone: (763) 792-1494
www.bermo.com
[email protected]

Midwest Mold Builders
Stillwater, MN
Scott Wahl
Phone: (651) 439-8156
www.midwestmoldbuilders.com 

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