BENCHMARKING

ECONOMIC INDICATORS FORECAST UNCERTAINTY

By Rachael Pfenninger, Project Manager, AMBA A lthough nearly 90% of mold builders report that current business conditions are positive in the American Mold Builders Association (AMBA) 2020 Business Forecast Report, several business indicators shifted significantly when compared to last year’s data. Amid rising challenges related to increased foreign competition and maintaining profitability, it seems likely that the industry may experience slowing or stagnating growth as it heads into 2020.

Current Business Conditions: 1st Quarter Trends

SURVEY HISTORY Now in its 10th year, AMBA’s annual 2020 Business Forecast Report analyzes data that was collected from more than 110 senior-level executives representing US mold manufacturing shops across 24 states. With this information, mold building companies are able to better benchmark how their companies stack up to industry norms, and executives can better align their anticipated outlook for the upcoming year.

Average State of Pipeline in Q1 2020

PROFITS AND HISTORICAL DATA As the industry heads into 2020, current profitability and employment maintain historical trends, but other economic indicators forecast uncertainty and slowing growth within the industry. Fourth-quarter trends hit near historic lows, as 76% of respondents reported that fourth-quarter quoting was either the same or down (up 13% from the previous year) while 75% of respondents (compared to 60% last year) indicated that backlog was the same or down. This data reflects new information benchmarked this year on the state of mold builders’ pipeline in the first quarter. Over half of mold builders reported that either their pipeline is not full enough or they are desperately looking for work; just over one-fifth of respondents said their pipeline is full or oversold. From a historical perspective, trending data on current business conditions reflects the information above. Overall, only 40% of respondents (10% fewer than last year) reported good conditions, while only 15% reported that conditions are excellent. For the first time since 2011, a percentage of respondents indicated that conditions are bad (i.e., that their pipeline is empty). New in 2020: Current Capacity Utilization

CURRENT CAPACITY UTILIZATION In addition to surveying respondents on the current state of their pipeline, AMBA also surveyed companies on their current and anticipated capacity utilization.

Molded to Perfection

Overall, the industry reported an average capacity utilization of 67%. Companies under $4.99 million in annual sales revenue tended to fall under the average, reporting lower capacity utilization (57% to 58%), while companies with $5 million or more in annual sales revenue tended to be above the average (68% to 83%). All respondents believed that their capacity utilization would rise in 2020, resulting in an overall industry expectation of an average of 72%, five percentage points higher than the current state.

MOLD BUILDING INDUSTRY CHALLENGES Despite its continued standing as a primary challenge facing the mold building industry, workforce development fell for the first time in three years – declining from a challenge reported by 100% of respondents in the previous year to 93% in this year’s survey. While it remains a critical issue within the industry, this change reflects a shifting of priorities. Challenges related to new business development, for example, were reported by 46% of respondents this year – a 13% growth over last year’s data. Maintaining profitability also shifted significantly, rising from a challenge faced by 7% of respondents in 2019 to 20%. Finally, foreign competition continues to weigh heavily on the US mold building industry and has risen in importance in this year’s report. (Read more on this topic on pgs. 22 and 23).

EFFORTS TO INCREASE COMPETITIVENESS As mold builders reviewed what challenges they faced in 2020, they also shared what was planned in 2020 to improve their overall competitiveness within the industry. Twenty-six percent of respondents reported that they intend to purchase new or update current equipment, while 15% of respondents have plans to concentrate on workforce development (an 8% increase over last year’s data). Another 14% plan to hone their strategic sales focus (an increase of 9% over last year’s data). Continuous improvement initiatives – which were planned by 25% of respondents last year – dropped to only 12% this year.

Overall, plans to improve competitiveness were in line with the challenges shared and demonstrated a renewed commitment to tackling the workforce development problem and the need to become more profitable.

Despite lower-than-average economic indicators heading into 2020, mold builders can feel some optimism. With recent changes to the tariff exclusions placed on Chinese-built plastic injection molds by the United States Trade Representative (USTR), many mold builders are hopeful that domestic work will begin to return to the US and that the pressure of foreign competition will ease. n

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HYPERTHERM TO AWARD POWERMAX SYSTEMS TO 12 NORTH AMERICAN SCHOOLS Hypertherm, Hanover, New Hampshire, a manufacturer of industrial cutting systems and software, now is accepting applications for its Spark Something Great educational grant program. In total, Hypertherm plans to award a Powermax45® XP plasma system, an AWS SENSE-approved plasma cutting curriculum kit and inperson training to 12 North American schools. The Spark Something Great grant program, now in its sixth year, is meant to support the next generation of welders and metal fabricators by making the newest generation of plasma cutting equipment and standardized instruction available to schools. This year, applications are due on or before April 1, with grant decisions communicated by May 1. For more information, visit www.hypertherm.com/grant.

[1] EMUGE CORP. APPOINTS SCOTT LOWE AS NATIONAL ACCOUNTS MANAGER EMUGE Corp., West Boylston, Massachusetts, a manufacturer of taps, thread mills, drills, end mills and other rotary tools, has announced the appointment of Scott Lowe as national accounts manager for the US and Canada. In his new position, Lowe is responsible for developing and managing channel partner relations with key customers, distributors and integrated suppliers of EMUGE products. Prior to joining EMUGE, Lowe worked at Kennametal, a supplier of tooling and industrial materials, mostly recently as sales manager. For more information, visit www.emuge.com.

32 the american MOLD BUILDER | Issue 1 2020 3D SYSTEMS AND ZVERSE PARTNER TO PROVIDE DESIGN CAPABILITIES ZVerse, Inc., Columbia, South Carolina – developer of the only CAD as a Service (CADaaS) platform for digital manufacturing – is partnering with 3D Systems – a provider of parts manufacturing services. The alignment will give 3D Systems’ customers access to ZVerse’s network

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of certified designers who can lend expertise to optimize file formats – facilitating desired final parts. These services include everything from design modifications to revising file formats to ensure the final part matches the customer’s requirements. Users will gain processspecific guidance throughout their manufacturing project’s design phase, with file optimization for specific manufacturing needs and pre-production quality checks. Because the ZVerse technology and designer network can handle high volumes of projects, it also offers increased speed of service for 3D Systems’ on demand customers. For more information, visit www.zverse.com and https://3ds.layr.co.

[2] GUILL LAUNCHES 10-DAY EXTRUSION TOOLING PROGRAM Guill Tool & Engineering, West Warwick, Rhode Island, a manufacturer of extrusion crossheads, tips and dies, has announced a 10-day tooling program. Eligible tips and dies will ship within 10 business days of receipt of a purchase order. US made for 55 years, Guill extrusion tools are produced using certified, documented quality steel material specifically qualified for the polymer to be extruded. A variety of tips and dies are available, featuring multilumen, stripe, multiple stripe, wire and cable, hose, pipe, tube, fiber optic, blown film, corrugated tube and profile. Eligible tips and dies cannot be plated and must have a diameter less than 1.5" and a length less than 4.75." For details on eligible tools, check with any sales representative. For more information, visit www.guill.com.

[3] RJG® AND HRSFLOW PARTNER UP, PROVIDE ADVANCED PROCESS CONTROL Traverse City, Michigan-based RJG ® – a provider of injection molding training, technology and resources – and San Polo di Piave, Italybased hot runner systems producer HRSflow have partnered to provide a process control solution for sequential valve gate control. They conducted a demonstration that included placing sensors in three different-sized cavities of a family mold and strategically

placing temperature sensors. The mold was designed to test the ability of the whole system to withstand difficult process conditions while ensuring optimal part production. The system was first tested through advanced mold filling simulation to establish initial process parameters. Results showed that systematic engineering and simulation efforts, integrated intelligent molding systems and flexible servo-driven hot runner technology greatly minimized the risks associated with a new tool launch. For more information, visit www.rjginc.com and www.hrsflow.com.

[4] STAR CHARITIES TO CARRY FORWARD IWARRIORS MISSION The iWarriors iPad program has transferred, effective December 1, 2019, to STAR Charities, Wauconda, Illinois, a registered 501C3 nonprofit entity. The program has provided tablet computer gift packages to more than 900 combat-wounded service members for use as rehabilitation and recovery tools. iWarriors was founded in 2011 by Kim and Tim Bartz who, nearing retirement, were approached by Don and Glenn Starkey of tooling components supplier Progressive Components and STAR Charities. “None of this would have been possible without the tremendous support of members and partners of the American Mold Builders Association,” stated Kim Bartz. “I have no doubt this support will continue with the new team at the helm.” For more information, call 847.487.1000 / 800.269.6653 or visit facebook.com/STARCharities.

ID ADDITIVES NAMES PCS AS EXCLUSIVE ID ECO-PRO 360 DISTRIBUTOR LaGrange, Illinois-based iD Additives, Inc., a supplier of additives to the plastics industry, has named PCS Company of Fraser, Michigan, as its exclusive distributor to injection molders and moldmakers in the US for its iD Eco-Pro 360 rust removal systems. The agreement is effective immediately. iD Additives will continue to sell and market iD Eco-Pro 360 directly for other non-injection molding-related rust removal applications, including extrusion, blow molding and non-plastics processes. For more information, visit www.iDAdditives.com.

[5] TST SELECTS AMERICAN QUALITY MOLDS FOR VISI ALLIANCE American Quality Molds (AQM), Hamilton, Ohio, and Tooling Software Technology, LLC (TST) have announced an alliance, bringing AQM’s library of its standard aluminum mold bases and Rapid Insert Dies (RIDs) to VISI CAD, exclusively distributed in North America by TST. TST selected AQM for this alliance because of AQM’s ability to provide aluminum mold bases and RIDs on a timely basis, maintaining sufficient stock of its standard mold base and RID components such that it can deliver a completed mold base or RID in two to three days. Having AQM’s standard mold bases already programmed into VISI’s software can reduce turnaround times even further. Also, special sizes can be designed rapidly in VISI by quick modifications of the standard mold base designs. For more information, email sales@tst-software.com or visit www.aqmolds.com. n