Manufacturers' Monthly March 2014 by Prime Creative Media

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INSIDE News & Analysis >> Tackling non-conforming products >> Exporting Endeavour Awards >> Compressors & Pneumatics >> 3D Printing

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4 Comment ■ Darkest hour is before the dawn

6 News & Analysis ■ Is importing really such a bad thing? ■ News in brief ■ Reader Comments

8 Industry Comment ■ Tackling non-conforming products

9 IT@MM

■ Secure the future, grasp opportunities

10 Exporting ■ Weaker A$ puts exporting back on the agenda ■ An exporting focus the key for award winner ■ Overcoming financial challenges for exporters

40 What’s new ■ ■ ■ ■

Heavy-duty hose reels Rotary position sensor LED task light Crossbelt sorter

42 The Last Word ■ Aim high for Australian manufacturing

16 Endeavour Awards ■ Introducing our 2014 sponsors

18 Laser Technologies

30 Fasteners & Adhesives

■ The latest directions in laser cutting ■ Laser rangefinder and app ■ 2D/3D laser line scanner for automation

■ Epoxy compounds getting tougher ■ Non-hazardous anaerobic adhesives ■ Self-amalgamating tape

22 Compressors & Pneumatics ■ How to reduce the cost of compressed air ■ Air springs ■ The importance of regular servicing ■ Energy savings make compressor decision easy

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36 Materials Handling ■ How to get the most out of forklifts

38 3D Printing ■ 3D printers move into the mainstream

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INSIDE News & Analysis >> Tackling non-conforming products >> Exporting Endeavour Awards >> Compressors & Pneumatics >> 3D Printing

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Comment

KEVIN GOMEZ – Managing Editor

Darkest hour is before the dawn

NEXTISSUENEXTISSUE • NMW Preview • Heating & Air Conditioning • Energy & Power Management • Products & Services Showcase • Welding & Profile Cutting • Enterprise Resource Planning • Cranes & Lifting Equipment • Production M A 0 3Line 1 4Safety _ 0 0 0 _ KEL • Manufacturing for Mining

4 MARCH 2014 Manufacturers’ Monthly

ITH the last car manufacturer departing our shores, it’s an opportune time to look at the path ahead for our industry. Let’s face it, Australia’s ‘product patriotism’ is limited to groceries, and does not extend to our purchase of cars. But local components manufacturers do have opportunities to make a dent in the export markets. We could take a lead from Isis Innovation, the technology commercialisation company of the University of Oxford. Isis is helping SMEs in the UK find partners for development of new products for the Chinese automotive supply chain. The city of Liuzhou alone has over 3000 companies engaged in auto parts manufacture. Many are entrepreneurs seeking technology and partnership as they identify and build next generation products to supply Chinese - and 1 overseas 2 0 1 4markets. - 0 2 - 0 4 T1 5 : 3 8 : Many Australian manufacturers

have the capability; perhaps the shuttering of the three auto plants will provide an impetus for some to look at overseas markets. The good news is that help is at hand – perhaps not publicised widely enough. Isis now has a presence in Australia and has set up a pilot Autoindustry Support Programme for Australian SMEs, helping them find suitable export partners. While the auto industry gobbles up more than its fair share of media space and mind share, other manufacturing sectors offer a ray of hope. The Australian chemicals and plastics manufacturing industry for instance, flies largely under the radar but plays a critical enabling role, supplying key inputs to 109 of Australia’s 111 industries. The sector is finding success in overseas markets as well and Cardia Bioplastics is a good example. The Victoria-based company 0 4 +application 1 1 : 0 0 development in does Mulgrave but manufactures in

Nanjing, China. Cardia is doubling its production capacity having just bagged a huge order from Brazil. It’s easier said than done, but we ought to retain our intellectual capital and move some production to lowwage regions. This should not mean a reduction in our manufacturing capability – an example is a Brisbane-based consultancy that helps Australian companies source low-value components from China. As profiled in this issue of Manufacturers’ Monthly, a local manufacturer of truck bull bars boosted turnover and actually doubled their local staff numbers after finding a cost-effetcive Chinese source for some input components. As always, the team at Manufacturers’ Monthly would love to hear from you, so do drop us an email, follow us on Twitter and join the discussions on Facebook and Google+. kevin.gomez@cirrusmedia.com.au

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Answers for industry.

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News&ANALYSIS In brief... Toyota to stop making cars in Aus Toyota Australia will stop building cars in Australia by the end of 2017 and become a national sales and distribution company. This includes production of the Camry, Camry Hybrid and Aurion vehicles, and the production of four cylinder engines.

Toyota denies Hockey claim Toyota has dismissed a claim by Treasurer Joe Hockey that Toyota Australia president Max Yasuda told him in December last year the company could continue manufacturing in Australia if workers agreed to a new set of conditions.

Coca-Cola and VIC invest in SPC Coca-Cola Amatil and the Victorian government have announced a new $100 million investment plan to assist fruit processor SPC Ardmona and the Goulburn Valley. CCA will invest $78 million and the Victorian government will invest $22 million over three years.

Combet backs Submarine project The Government should turn its attention to the building of submarines now that the car industry is effectively dead, according to former Industry Minister Greg Combet. He said an existing proposal known as the Future Submarine Project should now be considered.

Alcoa may close aluminium plant Fears are growing that Alcoa will shut the Point Henry aluminium smelter near Geelong and hundreds of workers will lose their jobs. The company has set the end of March M A 0 as 3 1its4decision _ 0 0 0 deadline. _ S OU2 1

6 MARCH 2014 Manufacturers’ Monthly

Govt may target penalty rates

HE federal government wants to change Australia’s award scheme and has suggested penalty rates could be cut. A submission to the Fair Work Commission review which was initiated by federal education minister Eric Abetz says that “The Government

acknowledges the potential for significant changes to modern awards to occur as a result of this Review.” According to the government, awards need to take into account economic conditions and job creation should be one of their key focuses.

What members of our manufacturing community think about the proposal to modify awards... Matt Workchoices is back!!!! Ian_AW Great!! They are finally going to target the penalty rates that politicians have made so much money off. I can’t wait to see the pollies actually earn every cent they do rather than be given handouts left right and centre.

If we talk about value for money then why is it that Tony two Tongues Abbott earns 3 times more than the American president...just a thought. Greg When children start going to school on Saturdays and Sundays, maybe then they can start looking at it.

Jarrod They won’t touch penalty rates for those that have already worked a minimum of a 38hr week. However rethinking the way we pay penalty rates for a person who only works Sundays for example makes perfect sense (and is a reasonable suggestion). Work Choices is not back, but finally we are having Ed the overdue conversation about I hope that the business leaders the archaic IR system that realise that when workers have Australia still operates under. less to spend then that too has an We are cavemen in this respect impact on them. I also note that compared to the other countries its only people who earn far more than there worth who think penalty that sit in the top 10 highest wage countries in the world. We need rates should go. And yes Matt get 2 0 you’re 1 4 - 0right 2 - workchoices 0 5 T 1 1 : is3back. 1 : 1 7 + to 1 1 : with 0 0 the times to become Ron There needs to be a financial incentive to work weekends and miss family/social time. For retail and hospitality, a rotating shift regime needs to have sufficient reward for working these unsociable hours and weekends.

globally competitive. Wages won’t be touched - ever! But we need to review the other perks and protections we still have. Editor’s note: These comments are as received. Corrections have been made for spelling and grammar only.

What do you think? Go to www.manmonthly. com.au and make a comment about this or any other issue.

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Is importing really such a bad thing? Does importing deserve its ‘bad boy’ status in the manufacturing industry or is it unfairly labelled due to the numbers who’ve tried and failed?

ANUFACTURING and importing components from China is a strategy many Australian manufacturers have probably considered to maintain competitiveness and profit margins in an increasingly tight economy, but up until recently relatively few have pursued it. According to manufacturing importer Cara Kenny, the fallout from DIY importing and from not using local professionals is massive, but for the few manufacturers who are doing it right, it’s the difference between ‘struggling’ and renewed prosperity. Kenny, who heads Australianowned Global Sourcing Services (GSS), is attracting an increasing number of Australian manufacturers who want to cut costs in their process. Among other things, GSS sources and works with overseas manufacturers to produce customised laser cut, stamped, machined, forged, cast, welded and fabricated, plastic and rubber components, and industrial foam and PVC fabricated items, and supply lower cost, quality off the shelf consumables. The company saves clients about 20 to 80 per cent on the cost of an individual component, depending on the product. For those who engage specialists

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to negotiate the minefield of dealing with Chinese manufacturers to shipping quality components back to Australia viably, it’s a strategy that’s paying off. Australia’s second largest manufacturer of truck bull bars, AJ’s Total Truck Gear is a Global Sourcing Services client who’s been actively importing selected components and off the shelf consumables through GSS for more than four and a half years. It was AJ’s bad experience in DIY importing that initially brought them together. According to AJ’s Total Truck Gear Director Andelys Thrush, the 20 year-old company needed a specific chrome-plated component but they couldn’t buy quality ones in Australia, without the chrome rusting off. “In the past, we’ve had suppliers who were happy to sell us rubbish,” she said. “A bull bar must have a highly polished finish. We were getting too many complaints about these particular components...” Thrush said AJ’s tried to import the component themselves but were frustrated because they couldn’t progress past the poor quality sample offered by the Chinese factory they were dealing with. Since meeting Kenny and working through the importing process for that very first part, Thrush said AJ’s hasn’t looked back.

Global Sourcing Services Director Cara Kenny. “They’re interested in helping you to make it work and they’ve taken on our business as if it was their own,” she said. Importing has helped AJ’s expand its Toowoomba staff from 13 to 25, among other benefits. Thrush says they’ve added considerably to the number of components GSS sources for them and these now include some previously high cost, high volume consumables they use in their manufacturing process. “Some cost savings would be $30,000 alone just on consumables and for more complex components, the cost savings have been huge,” she said.

The improved profit margin enabled AJ’s to acquire two struggling bull bar businesses in Victoria. “We’ve made them more profitable and re-invested back into those businesses and discovered they were doing it the old fashioned way -paying retail,” Thrush said. Kenny warns manufacturers who are considering DIY importing or engaging overseas agents direct that importing’s a very risky venture with an extremely high failure rate. “In today’s economy, who can afford to get stuck with something that doesn’t work or costs more than is viable after adding on the unforeseen and often hidden costs associated with port charges, customs clearance, and local and overseas logistics?” she said. “So many products that Australian manufacturers use in their businesses are imported but they’re not reaping the benefits. The ones who discover how to import profitably and mitigate risk are the ones who are thriving.” Global Sourcing Services 07 3161 5109 www.globalsourcings.com.au AJ’s Total Truck Gear www.ajstotaltruckgear.com.au

Manufacturers’ Monthly MARCH 2014 7

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Industry COMMENT

INNES WILLOX – Chief Executive, Australian Industry Group

Tackling non-conforming products Research by Ai Group confirms that the use of non-conforming products in the building and construction sector is a significant problem. The time has come for stakeholders to join with government and take action against them. Innes Willox writes.

conforming to relevant standards HE chorus of complaints and regulations can be at a competiabout non-conforming prodtive disadvantage when the price at ucts (NCPs) infiltrating the which a competing product is sold building and construction sector reflects lower levels of attention to raises important questions about the quality that is required under quality and safety. It also poses seriAustralia’s conformance framework. ous commercial challenges for the Without action, non-conforming prodbusinesses that do play by the rules. ucts will remain in the market. The evidence of non-conformance To help get a better picture of the now in the Australian building marcurrent situation, Ai Group has reket including structural collapses, cently conducted extensive research understrength materials, shoddy and and interviews with more than 400 fraudulent practices, inadequate businesses across steel, electrical, compliance frameworks, glass fallglass and aluminium, engineered ing from high rise buildings and wood products, paint and plastic electrical equipment posing fire and pipes industry sub-sectors. electric shock risk indicate there is a threat to employee and public safety. A D _ P A C E P L A A P R _ 1 2 . p d f ThePreport a g e “The 1 quest 1 4 / for 0 3a level / 1 2 , playing field: The non-conforming Australian-based businesses

8 MARCH 2014 Manufacturers’ Monthly

building products dilemma” is the first step in this process. Of great concern was the finding that 92% of respondents reported NCPs in their supply chain. This was even higher in the steel product sector with 95% of respondents in this sub - sector acknowledging NPCs. Steel fabricators as well as steel building products manufacturers are the hardest hit by non-conforming product due a conformance framework that is overly reliant on first party certification and an increasing exposure to nonconforming structures and products. According to this survey, 45% of companies are experiencing eroded margins revenues due 1 0 : 0 and 6 reduced AM to the presence on non-conforming products. In addition to the impact on individual business’s finances, the report indicates NCPs can pose safety risks, escalate deterioration rates in buildings, reduce asset values, increase maintenance costs and could impact on the Australian economy. The efficiency of the current regulatory system and conformance framework was also examined in this research. Despite convincing evidence of NCPs in the market, 43% of respondents reported they had not lodged a complaint when encountering NCP. There appears to be confusion among stakeholders about who has responsibility and the arrangements for reporting and recourse when non-conforming product is found. In some cases the gaps and weaknesses in the building products conformance framework are giving rise to voluntary, industry led, third party product certification schemes and such arrangements can be effective. The report suggests that building certifiers bear a disproportionate share of the burden for ensuring product conformance and that greater emphasis on conformance at point

of sale and increased responsibility on product suppliers and builders may be required. Clearly this is an area which requires action. Ai Group believes stakeholders, in consultation with all tiers of Government, need to examine how to best address the gaps and weaknesses in the building and construction sector conformance framework. As well, the building certification arrangements should be

“

...further research would be beneficial to identify leading conformance models that are effective whilst keep ingcompliance costs to a minimum. reviewed with a focus on clarifying the role of building certifiers and assessing the adequacy of existing arrangements regarding non-conforming product. Clarity should be provided on how to report non-conforming product as well as promoting the role of regulatory bodies in the building and construction sector. Further research would be beneficial to identify leading conformance models that are effective whilst keeping compliance costs to a minimum as well as give an indication of other industry sectors with problems. The uneven market created by non-conforming products risks a downward spiral of product standards, quality and safety with the potential for harm to manufacturers, employees and the public. www.aigroup.com.au manmonthly.com.au

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TechnologyIT@MM Secure the future, grasp opportunities The vision for Industry 4.0 addresses the challenges faced by manufacturing with the development of intelligent, integrated production units - which will also have an impact on the process industry.

ANUFACTURING companies are facing numerous challenges: energy and resource efficiency are becoming increasingly decisive factors for competiveness; innovation cycles are becoming shorter and markets more volatile. The aim of ‘Industry 4.0’ is to addresses these challenges. The term was coined in Germany because the subject forms a fundamental part of the high-tech strategy of the German government. The underlying concept of an “Internet of things” can be found world-wide, however, in relation to the future of industry. The concept behind Industry 4.0 is that, in the future, plants will consist of intelligent, autonomously operating production units (cyberphysical systems, CPS) by means of interdisciplinary engineering. The company-wide networking and interaction of CPS turn these intelligent plants into flexible value creation networks. But in order to make this vision a reality, some challenges must still be overcome. The prerequisite is an infrastructure that provides a flexible access to information not only at the plant but also beyond. Production resources and products must have their own intelligence in order to perform functions independently, and digital and real plants need to merge. Some prerequisites for this already exist, while others still need to be further developed or are yet to be conceived. For this reason,

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Industry 4.0 will not immediately become a reality in day-to-day production in the process industry. Nevertheless, experts are sure that companies in this industry will be part of this innovative and flexible value creation network - although to varying degrees, based on the sector and processes involved.

Intelligent units The omnipresent communication between CPS requires correspondingly powerful communications networks that connect all levels of the plant and that still meet industrial requirements, such as, for example, Profinet. This increased networking means, however, that the protection of IT systems and networks from attacks and disruptions will play an increasingly important role. Security certification of communications components and defense-in-depth industrial security concepts are essential. Siemens has already devised suitable solutions for this purpose, which will be further developed in the future. An important issue for the operation of a process plant will be how autonomy and selforganization can be reconciled with the high availability and security requirements of process automation. The flexible production described by Industry 4.0 can be best conceived in a batch environment. Intelligence

FASTFACTSFASTFACTS

Industrial history • The first industrial revolution: The introduction of mechanical production equipment driven by water or steam. • The second industrial revolution: Mass production achieved by the division of labour and the use of electric power. • The third industrial revolution: The use of electronics and IT to further automate production. • The fourth industrial revolution: Networked plants with intelligent autonomous operating components (cyber-physical systems). that is correctly applied can even increase plant availability. For example, intelligent production units are already providing their current technical status and at the same time processing the maintenance information of components such as valves, pumps, heat exchangers, and even complete plant sections. This data is further processed as part of asset management. This will contribute to a reduction in downtime and a further increase in productivity. As products and production resources become ever more intelligent, mechanisms for the integration and exchange of more complex information must be in place.

The digital and real worlds The merging of the digital and real worlds in the process industry means that plants and products must each

always contain a corresponding model. This model describes how and why a product or a plant was conceived, developed, produced, and used. Each physical object must contain an explanatory model, that is, a formal description of its characteristics. The Siemens Digital Enterprise Platform concept, with its comprehensive approach to the plant lifecycle through the phases of process development, plant engineering and construction, commissioning, operation, and maintenance, is already achieving this engineering vision for Industry 4.0 in the context of Siemens product portfolios. Today, Comos planning software, for instance, can already transfer data directly into automation engineering in Simatic PCS 7.

Investment in the future Although the time horizon of Industry 4.0 can still not be precisely defined and the design phase is not yet entirely complete, companies should set their course for the future. Today, Siemens is already offering a wide array of products and solutions that will serve as an important foundation for a reference architecture in the Industry 4.0 environment. Siemens 137 222 www.siemens.com.au/ futureofmanufacturing Manufacturers’ Monthly MARCH 2014 9

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ManagementEXPORTING The Chinese middle class, expected to reach 630 million by 2022, is now a valid target for many exporters.

Weaker A$ puts

exporting back on the agenda With the Australian dollar now at more realistic levels against the US dollar, many manufacturers are revisiting their exporting plans, with a focus on China in particular. Alan Johnson reports.

10 MARCH 2014 Manufacturers’ Monthly

AYBE the softening of the Australian dollar has come too late for Holden, but for those manufacturers with a long term future in Australia 2014 could be a perfect time to dust off their export plans from a few years ago. Mark Thirlwell, Austrade’s Chief Economist is upbeat about manufacturing’s exporting future, saying the key indicators are all positive. “There are grounds for optimism, especially with a gradual weakening of the currency,” he told Manufacturers’ Monthly. He admits it has been a tough couple of years for the manufacturing sector with a very high currency and a fairly weak trade environment; all against a backdrop of a structural transition to highly

competitive Asian manufacturers. “You put these three things together and it has been a really tough external environment for the manufacturing sector overall. “But looking at 2014, I can see things starting to turn around, with the currency starting to come down to where it should be, in line with the fundamentals of the Australian economy.” He also said the external picture is starting to look better as well. “We are not expecting a global boom, but we are expecting global growth to pick up and be far stronger than in 2013. And when you look at the trade forecasts, they are all looking a lot better than they have for quite a while. “So after being hammered for the past few years, the manufacturing

FASTFACTSFASTFACTS

Exporting • 2014 looks like a good year to start exporting. • The Chinese middle class continues its astonishing growth. • Do your homework and choose your market wisely. • When doing business overseas, understand the local culture.

sector will not be quite as much under the cosh as it has been,” he said. Thirwell said that for manufacturers keen to start exporting, it is important they understand their strengths, and their competitors’ strengths. “They should also understand what their manmonthly.com.au

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ManagementEXPORTING proposition is, and the markets they are going into. “While there are a lot of opportunities out there, it is important manufacturers do their homework and understand where is the best fit for their products and which are the best markets for them. “Sometimes you can target an opportunity and seize it, but in most other cases it is important to do due diligence and make a strategic decision to go to market. Thirlwell said one of the most effective ways of avoiding commercial disputes is to choose the right business partner. “This includes fully understanding the company, its history, structure and background, as well as the key individuals involved; both with your business and, if they are different, the owners/key decision-makers in the firm.” He said the most common regret expressed by Australian businesspeople who have encountered disputes and worse, is that they didn’t put enough effort into this selection.

Opportunities in China Thirlwell describes China as an ‘interesting’ story. “For the past couple of decades it has been an excellent opportunity if you had input into China’s exporting machine with resources and commodities, but if you were competing against it in the global manufacturing sector then China has made life tough for you. “But with the on-going adjustment in the Chinese economy, which is part of the broader adjustment across Asia more generally, these economies are shifting away from a pure export growth model towards something that has a bigger role for the domestic economy. “This leads to China being a far more interesting demand story for people beyond just the resource sector. “We have seen that in terms of tourism and education, but as you broaden out that consumer story in China then you would expect to broaden out to a wider demand story coming out of China. There should be scope there for some excitement,” Thirlwell said. 12 MARCH 2014 Manufacturers’ Monthly

However organisations such as McKinsey are warning companies that they must adapt their offerings and ways of doing business, as China gradually shifts to a more consumerdriven economy. New government policies are said to favour household income growth and support the expansion of the service sector and private enterprises, especially small and midsize businesses. Researchers at McKinsey say two pointers of a more economically developed society will be higher productivity of its workers and higher productivity and greater efficiency of the government. These trends will create more and betterpaid jobs and thus raise the share of the national income in the hands of consumers. The evolution of China’s middle class means that sophisticated and seasoned shoppers, those able and willing to pay a premium for quality and to consider discretionary goods and not just basic necessities, will soon emerge as the dominant force. A recent report from McKinsey’s China office, What’s next for China?, identifies key areas companies should focus on: 1. Embrace the new trends in urban development. Companies should design city-specific solutions—products, marketing approaches, and operating models— that meet the varied needs of the smaller cities that are expanding rapidly and underpinning China’s long-term growth. In addition, they

“

Thirlwell says those companies that are already based in China are very optimistic about doing business there...

should optimise their resources across the hub-and-spoke city clusters emerging throughout China. Hub cities will increasingly service the needs of the spoke cities, where

1 3 127 3

9 99 9

69 69

38 38

Pessimistic Pessimistic Slightly pessimistic Slightly pessimistic Neutral Neutral Slightly optimistic Slightly optimistic Optimistic Optimistic

45 45

83 83

31 31

38 38

2012 2012

2013 2013

Outlook for the Chinese economy (percentage of respondents). Australia-China Business Perceptions Survey

15 15

21 21

24 24 40 40

85% 85%

Increased a great deal Increased a great deal Increased moderately Increased moderately Increased slightly Increased slightly Stayed about the same Stayed about the same Decreased slightly Decreased slightly Decreased moderately Decreased moderately Decreased a great deal Decreased a great deal

said competition had increased in said competition mainland China had increased in mainland China

Change in level of competition in China over the past year (percentage of respondents). Australia-China Business Perceptions Survey most manufacturing takes place. 2. Focus on the growing demand for services and consumer goods. As disposable incomes rise, consumers will be able to buy more services and goods. That should spur the expansion of new service businesses ranging from catering to financial services, as well as the further expansion of demand for consumer products, across China’s immense and growing market. 3. Foster new skills and innovation capabilities. The growth of the urban labour pool is slowing as the country’s population ages. Companies will have to increase their productivity through training, automation, more flexible production, and enhanced employee loyalty. They will also need to foster new skills, from strategic planning

to the maintenance of high-tech equipment.

China survey Thirlwell says those companies that are already based in China are very optimistic about doing business there, citing the recently released Australia-China Business Perceptions Survey. “The results highlight the opportunities and challenges Australian foreign subsidiaries face in China and provide a sense of how Australian businesses are leveraging the strong trade relationship between Australia and China to grow their businesses. “The survey shows that while respondents report extra competition there, they think they will be able to handle it very well. In fact, four out manmonthly.com.au

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of five people who responded to the survey said competition had gone up. “However their expectations for growth and profitability for the year ahead, in fact for years ahead, are very strong, and when we asked why is this they said it was the quality of their offerings were a big part of it. In fact, three out of four respondents said they expect to expand over the next five years,” he said. As well as having the right partners, Thirlwell said other challenges of operating in China included the availability of skilled staff, an unclear regulatory environment, and a lack of transparency of how things worked.

Protecting your IP Austrade points out that while China is now a signatory to most major international IP agreements and has a legislative framework broadly in line with international norms, Australian companies need to be cautious of the risks around IP infringement. China operates a first-to-file system meaning just that, the first person to register a trademark in China becomes the legal owner. Consequently, one of the most common IP risks is ‘Trademark squatting ‘. If an Australian company finds this has happened, there are options available to recover your brand, but these are often lengthy and expensive, with no guarantee of success. It is strongly recommended that Australian companies manufacturing in or exporting to China register their trademarks in both English and Chinese as early as possible.

Business etiquette in China Austrade recommends the following when doing business in China: • Building business relationships and trust is important in China, so expect to spend time at meetings and banquets with your potential business partners. • Business meetings always start promptly, so it is important to arrive early for the standard formal introductions. It is usual to be introduced to the most senior person at the meeting first, followed by the others in descending order of seniority. manmonthly.com.au

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• A handshake is the standard way to greet men and women, whatever their age or seniority. Note that the Chinese respect their elders, so an extra show of courtesy in the presence of an older person will reflect well on you. • Business cards (ming pian) are essential in China, and it is a good idea to have your card translated into Chinese on the reverse side. Present your card with both hands with the Chinese side face up. It is a sign of respect to spend a few moments examining the business cards you receive rather than putting them away immediately. • When meeting potential business partners, it is helpful to know some Mandarin. Simple phrases such as ‘Ni hao’ (hello) ‘Zao shang hao (good morning) and Xia wu hao (good afternoon) can go a long way. Note that surnames are placed first, eg. Mr Yao Ming should therefore be addressed as ‘Mr Yao’. • A great deal of business in China is conducted over dinner, where very senior people may attend who were not at previous negotiations, but are key to the approval of a business deal. However, business dinners can also indicate a general warming of a relationship, and in this case, their role should not be over-stated. • Never begin eating or drinking until you host does. It is polite to try all dishes that are offered to you, but you can discreetly leave anything you don’t like at the edge of your plate. • Dinner speeches and frequent toasts are standard, with locally produced wines or ‘bai jiu’ spirit the usual drinks for toasts. It is customary for toasts to be made by both sides. • The Chinese generally like to give small and inexpensive gifts. It is a good idea to bring small gifts with an Australian theme for your hosts and wrap them in colours such as red, yellow or gold, which are regarded as lucky in China. It is not customary for your hosts to open the gifts in front of you, unless you encourage them to do so. • Chinese negotiators are shrewd and know that foreigners will be reluctant to travel home from China empty-handed. They are willing to stretch out discussions, which can wear their foreign

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counterparts down. Be sure that your interpretations of any business deal are consistent with theirs and that everyone understands their duties and obligations. • Expect to encounter delays or frustration during your business dealings in China, but it is important to remain patient and polite. The Chinese don’t like to ‘lose face’ so losing your temper or showing M A 1will 1 1 only 3 _ set 0 0 you 0 _ back. BOK frustration

• If you are beckoning to someone, motion towards you using your hand and palm pointed downwards – never palm up. Furthermore, don’t use your index finger or point when speaking. [Alan Johnson is Manufacturers’ Monthly’s former editor. He has researched and written about all aspects of the Australian manufacturing 1 2for0 more 1 3 -than 1 025 - years.] 0 9 T1 4 : 1 3 : 4 6 + 1 1 : 0 0 sector

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ManagementEXPORTING An exporting focus the key for award winner Rode Microphones, whose products are better known in the US and Europe than Australia, has taken out Austrade’s prestigious Manufacturing Export Awards. Alan Johnson reports.

ETER Freedman, founder and MD of the iconic pro-audio company, has some advise for other manufacturers to focus on exporting and to forget the local market - “It’s too small.” “The major reason for our success is that we concentrate all our efforts on being an exporter rather than what many manufacturers do and focus on the local market, then do a little bit of exporting,” Freedman told Manufacturers’ Monthly. “So when things turn bad, such as the high dollar, or they become uncompetitive because of tariffs, they are in trouble,” “We had no protection to the high dollar, but still managed to grow. We did that by investing in highly efficient production techniques such as computer aided machinery, the best IT tools and software, because we are competing with some very serious companies. “We have the best technology here, equal if not better to anywhere in the world. We have invested heavily in top quality machines and are able to machine consistently in microns, measuring down to nanometers. “Plus we have a very strong marketing team here in Australia, in fact we spend millions of dollars every year on marketing. You have to tell the world what you have to be successful.” The Austrade award tops off a record year for Rode, which has now expanded to a total of 108 global markets, won multiple international product design awards and released a number of exciting new products including the recent NT1, M5 and VideoMic GO microphones. The company recently doubled the size of its manufacturing plant and company headquarters in Silverwater, Sydney, significantly increasing its capacity to meet the rapidly-expanding international demand for its products, as well as further vertically integrating its operations. “We have around 130 employees at

14 MARCH 2014 Manufacturers’ Monthly

We would have continued to grow even with the dollar at $1.10 - Freedman. the moment, but I expect to expand that number by 25% this year as the company continues to grow. “We would have continued to grow even with the dollar at $1.10,” he said. Freedman says the Australian dollar falling in value against the US dollar has not had any impact on his business today. “It will take a year or two to have any impact,” he said.

“

Freeman explained that, once you have been exporting for a while, you get used to being a bit of a risk taker. “You don’t just turn it on, for example we are just about to take delivery of a production machine that has taken two years to design and build. “But of course I’m very happy

the dollar is falling. We are making more money now, another 20% profit thank you very much. Freeman explained that, once you have been exporting for a while, you get used to being a bit of a risk taker. “We are not adverse to risk, and export well over 95% of our products all over the world. We have our own distribution company in the US, but in other countries we use distributors,” he said. Interestingly Freedman is not a great fan of using patents to protect the company’s IP. “We do have some patents and design registrations, but for me the best way to protect yourself is to manufacture a product that everyone wants, at a price that is incredibly competitive and sell the ‘crap’ out of it. “That way people can’t come under you - there’s no opportunity for them. “You can come up with a patent, but that is just the beginning. Patents can take ages to produce and cost a fortune. But then you have to protect them, which can be very expensive,” he said. Freedman explained that the

vast majority of the company’s manufacturing is done in Australia, but admits that some plastic moulding and casting, and a little bit of toolmaking work is sent to China. “But all the high tech work, the plating, the assembly that’s all done here. It’s only work that’s got no IP we send off-shore,” he said. Regarding the finished products, Freedman said they sit in the ‘sweet’ middle of the market, with the line between top and middle blurring. “And we are one of the companies that made that happen.” “Because of our production volumes and the quality that we are able to achieve through economies of scale, the products we produce are far better than many of the high end products. It’s a myth that handmade microphones are better, that’s rubbish,” he said. Freedman said the Austrade Award was the highest compliment that Rode has been given in more than twenty years of business. “We’re proud to be Australian; designing and manufacturing the world’s very best microphones right here in Sydney and shipping them to every corner of the globe.” manmonthly.com.au

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Overcoming financial challenges for exporters When commercial banks are unable to provide finance for exporting projects, manufacturers are advised not to panic as there are other options, as Andrew Watson reports.

S the global economy continues to recover and Australia looks to drive economic growth, there are numerous opportunities for Australian businesses to expand internationally. While conditions in the Australian manufacturing industry remain challenging, there are certainly some strong opportunities for expansion overseas. For businesses that take advantage of these opportunities, branching into exporting is exciting; however it can throw up some challenges. There are many commercial and operational considerations for any business looking to export, including winning a tender, financing a deal, operating in a different business environment and adhering to local regulations. Navigating these challenges is all part of the growth journey and understanding how to prepare for them will ensure a smoother path to expansion.

Successful tendering Once a company has found a suitable contract, the next important step is making sure the business is ahead of the competition and submit a winning tender. The keys to successful tendering can be grouped into two broad categories: doing sufficient research and planning ahead of submitting a tender, and being able to access suitable finance in a timely manner to execute the contract. Having a plan in place to achieve the tender is important for all businesses looking to secure a contract. Background research and good planning helps identify gaps and weaknesses in a business plan which manmonthly.com.au

may be holding the firm back from winning tenders.

Financial barriers However, winning a tender or contract is just the beginning. Probably the most important step in securing new manufacturing contracts is working out how to finance the deal. The commercial finance market will consider factors such as a company’s track record in delivering a product, quality of management systems, balance sheet strength and cash flow management before deciding whether to lend funds. However, sometimes commercial banks are unable to provide finance for various reasons, such as transactional or country risk or a long payment cycle and associated financing terms. This is where export finance can help. Australia’s export credit agency, Export Finance and Insurance Corporation (EFIC) supports the growth of Australian companies in their international activities by providing tailored financial solutions when the private market faces constraints. EFIC assists Australian-based businesses so that they can take advantage of commercial export and overseas investment opportunities. It also supports buyers of Australian goods and services in emerging markets and subcontractors to Australian exporters. EFIC has helped numerous manufacturing businesses export by helping to finance deals through a range of tools including working capital support and performance or warranty guarantees. For example, Camatic, a Victorianbased commercial and venue seating

manufacturer, is a company that has benefitted from working with EFIC. Camatic manufactures seating for stadiums, theatres and cinemas on a contract basis. It has had success both domestically and in international markets. The company won a seating contract for the new San Francisco 49ers football stadium in Santa Clara, California, and needed working capital support to complete the project. EFIC provided Camatic’s bank, NAB, with an export working capital guarantee (EWCG) facility to support the contract. The guarantee was used to support the manufacture, delivery and installation of 68,500 seats for the Santa Clara Stadium. An EWCG supports the provision of working capital for export or exportrelated contracts and can help a company’s future export growth plans.

Business challenges In addition to financing challenges, prospective manufacturing exporters will need to do their homework before they rush to clinch a contract in a market which may be very different from the Australian business environment. The World Bank produces a ‘Doing Business’ gauge for all countries around the world, which ranks different countries on measures such as ‘ease of doing business’, ‘protecting investors’ , ‘enforcing contracts’, ‘controlling corruption’, and ‘regulatory quality’.

Local regulations Companies also need to become familiar with the operating

Export finance can help when the banks can’t. environment of the country they are moving into. While each market may have quite different operating risks, some important things to look out for are industrial relations policies and practices, permitting rules and import requirements. Local practices may differ from those in Australia which, if ignored, could result in difficulties fulfilling the export contract. New markets may also have very different information requirements to what Australian businesses are used to, such as tax provisions and labour regulations. While such information is typically readily available in Australia, in some foreign destinations it may not be, thus potentially exposing Australian-owned businesses to being non-compliant with local requirements (either formal or informal). Austrade can assist in this area, providing information, advice and research on exports markets. Exporting to new and emerging markets can often throw up unique and different challenges in the process, including tendering, financing deals, business risks and operational considerations. Being aware of and prepared to tackle these challenges is critical to successfully winning and fulfilling export contracts. [Andrew Watson is Executive Director, SME, with EFIC] www.efic.gov.au Manufacturers’ Monthly MARCH 2014 15

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EndeavourAWARDS

Enter online at manmonthly.com.au/awards

Introducing our 2014 sponsors Now in its 11th year, the Manufacturers’ Monthly’s Endeavour Awards program enables Australian manufacturers to highlight their recent successes and achievements.

Principal Sponsor

Technology Application

It is with great pleasure that BlueScope continues their support of the 2014 Manufacturers’

The strategy in 2014, as always at ifm efector

Monthly Endeavour Awards as the principal sponsor. The sponsorship forms part of

is to focus on innovation, quality, and strong

BlueScope’s ongoing commitment to manufacturing in Australia and our continued focus on

customer service and support. For 40

servicing and promoting our domestic customers.

years the company has been researching,

As one of Australia’s largest manufacturers and the leading manufacturer of flat steel

developing and producing products and

products, BlueScope continues to play a key role in Australian manufacturing. Attributes that

technology to optimise technical processes.

have built the BlueScope brand, such as world class quality, durability, technical backup and

ifm continues to invest significantly in R&D,

support will continue to encourage innovation and inspire confidence by assisting to minimise

employing 450 development engineers. Thus, ifm continuously

risks in the manufacturing industry, says Steve Gregson, Manager Manufacturing Markets, BlueScope.

optimises technical processes in almost all industries and is one

BlueScope steel is designed for Australian conditions and utilises world leading technologies – and all with the backing of BlueScope for ultimate confidence. BlueScope is proud to associate with the 2014 Endeavour Awards,

of the world’s leading manufacturers in the automation industry. “Our German engineered products all undergo rigid

acknowledging Australian manufacturers who display excellence and innovation in their work and values the continued

testing in conditions that far exceed their intended application

support of the manufacturing industry in 2014.

environments to ensure high standard of quality and safety,” says BlueScope 1800 800 789 www.steel.com.au

David Delany, Managing Director, ifm efector. “Our customers count on ifm to be a reliable partner for their automation and control solutions. We pride ourselves on our service and support.” This includes on-time delivery. ifm hold extensive stock at

Global Integration

our warehouse facilities in Australia and New Zealand, and our products can be delivered overnight in over 97% of instances. We

Industry Capability Network (ICN) is a business network that introduces Australian and New Zealand companies

Derek Lark, Executive Director, ICN Limited. At the heart of ICN’s service is ICN Gateway, an online

to projects large and small. Every day ICN works with

system that connects buyers and suppliers looking to

local suppliers and project managers to help save valua-

build partnerships. Suppliers can search projects and

provide strong phone based and on-site solution focused service and support for your application challenges, knowledgeable and efficient customer service and easy order placement. Through our website, customers can also easily check price

ble time and money in the procure-

and availability, track orders, view order history and purchase

ment process. Since its inception

project managers to manage the supplier registration

ifm products using e-shop. From inductive and flow sensors to

29 years ago, ICN has helped local

process for their projects.

pressure and temperature sensors - from individual sensors to a

suppliers find $296 billion worth of contracts. There are many success

To find opportunities for your business, and to register your interest for projects, visit gateway.icn.org.au.

complete system solution - our customers can find sensor and control products to suit their requirements.

stories from the manufacturing industry that ICN has been involved in where local Australian businesses have secured contracts with large-scale projects, says

Industry Capability Network (ICN) 1300 961 139 icn.org.au

ifm efector 1300 365 088 www.ifm.com/au

ifm efector

Business Transformation Enterprise Connect is proud to support

of Division, Enterprise & Skills Connect,

you command a premium price, gain market

the Manufacturers Monthly Endeavour

Department of Industry.

share and even reduce production costs.

Awards as it provides a great opportunity

Enterprise Connect has been providing

If you have driven your business forward

to promote the valuable contribution of

advice and support to Australian manufac-

in the last 12 months, I encourage you to

Australia’s manufacturing sector to the

turers since 2008, delivering more than 4000

nominate for the awards and be recognised

Australian economy.

Business Reviews and over $21 million in

for your contribution to the success of the

Tailored Advisory Service funding.

industry. Good luck!

This year we are sponsoring the exciting new Business Transformation Award, which

We are continually developing our

will recognise and celebrate small and

services to meet the changing needs of

medium businesses that have successfully

manufacturers in Australia. Enterprise

designing and delivering high value products

transformed and in doing so, increased their

Connect’s new Design Integration Program,

and services, sustainably and profitably.

productivity, innovation and competitive-

for example, provides businesses with a

Properly applied, design can give your

ness as a result, says Deborah Anton, Head

strategic and operational framework for

business a competitive advantage, helping

16 MARCH 2014 Manufacturers’ Monthly

Enterprise Connect 131 791 www.enterpriseconnect.gov.au

manmonthly.com.au

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Manufacturers’ Monthly Endeavour Awards Deadline extended to March 7 These are the only awards designed specifically for Australia’s manufacturing industry. All finalists receive two free tickets to the gala dinner in Sydney. The awards dinner is a great way to meet new customers, make contacts, and raise staff morale. Entering the Endeavour Awards is easy: simply email kevin.gomez@cirrusmedia.com.au or visit the Awards website at www.manmonthly.com.au/awards to download an entry form. The deadline has been extended to Friday March 7, so hurry for your chance to be part of the biggest Endeavour Awards yet!

Exporter of the Year EFIC is proud to be sponsoring the Manufacturers’ Monthly Endeavour Awards Exporter of the Year. As the Australian Government’s export credit agency, we are committed to

Australian Industrial Product

supporting Australia’s manufacturing exporters. We work directly with businesses and their banks to provide loans, guarantees, bonds and insurance products to

BOC is extremely pleased to be participating in the 2014 Manufacturers’

assist these companies with their growth in international markets.

Monthly Endeavour Awards. These awards are very much in keeping with BOC’s own core values of recognising excellence and innovation

As an example, we recently provided commercial and venue seating manufacturer, Camatic Pty Ltd, with working capital support for a seating contract

in manufacturing and industry, which is why the company is delighted

for the new San Francisco 49ers football stadium in Santa Clara, California.

to be continuing its support as a major sponsor. As a leader in the

Camatic is a Victorian-based company that manufactures seating for stadiums,

application of technology, BOC is constantly looking for new ways

theatres and cinemas on a contract basis. The company has had success both

to provide our customers with high quality products and innovative solutions, says Dr

domestically and in international markets, having completed projects for the Sydney

Chris Barnes, General Manager Industrial Gases, BOC. One of our most exciting recent

Opera House, Melbourne Cricket Ground and the stadium for the Atlanta Olympics.

achievements has been the advancements in delivering the very latest cylinder and valve

EFIC provided Camatic’s bank, NAB, with an export working capital guarantee

technology to our growing customer base through our Raise the Bar campaign. BOC’s new

(EWCG) facility which was used to support the manufacture, delivery and installation

cylinders have market leading capacities enabling users to reap the rewards of longer times

of 68,500 seats for the Santa Clara Stadium.

between fills and reduced downtime. Our new cylinders will deliver significant benefits to our

If you are a manufacturing exporter like Camatic and need financial assistance to

customers. Greater capacity means increased time between fills which in turn means better productivity no matter what the end use.

fulfil an export contract EFIC may be able to help. I wish all this year’s nominees the best of luck, says Andrew Hunter, Managing Director and CEO, EFIC.

This mammoth and complex task isn’t something we have to do – it’s something we’ve chosen to do as leaders in our field. By continually challenging ourselves to raise the bar we ensure our

Export Finance and Insurance Corporation (EFIC)

customers can always count on us to deliver the very best gas-related products and services.

BOC 131 262

1800 093 724 www.efic.gov.au

www.boc.com.au

Atlas Copco, a leading provider

Most Innovative Manufacturing Company

SICK is proud to once again be part of the 2014

of sustainable productivity

The 2013 calendar year

Manufacturers’ Monthly Endeavour Awards sponsoring

solutions, was recognized

was a difficult business

the Safety Scheme Award.

by the annual Global 100 list

year for many companies

Modern safety solutions offer

as one of the world’s most

in Australia. Now that this

the optimum combination of

sustainable companies.

landscape is clearer, the

safety and efficiency: intelligently

The list, presented at the

economic scenario will gradu-

co-ordinated emergency stop

World Economic Forum in

ally improve, says Robert

strategies, zone concepts or

Switzerland in January 2014,

Merola, Managing Director,

muting functionalities that

ranks companies that prove

SEW-EURODRIVE. There

optimise production work flow.

they are increasing productivity while using less resources.

are certainly some marked

Atlas Copco is ranked 46, and it was the eighth time the

improvements in terms of

safety solution is paramount to offering the competitive

company appeared on the list. Creating business value

projects for 2014. In prepara-

advantage our customers demand.

through sustainability is at the core of Atlas Copco’s products

tion, we have chosen to take a close look at our most

and service. The Group’s sustainability goals include boosting

important resource, our staff.

Environental Solution

Safety Scheme

Together with our partners, the investment in the next

The secret to success is to ensure all sensors work in any automation scenario providing our customers

Recently, we welcomed new Engineering graduates

with the freedom to design and create the best possible

2010 and 2020, decreasing CO2 emissions, working actively to

into the SEW family. Over the next year they will receive

safety solution, says Jason Mair, Product & Marketing

eliminate corruption, and promoting access to clean drinking

intensive training to give them every opportunity to

Manager, SICK.

water in countries in need.

succeed in our industry.

customer energy-efficiency by at least 20 percent between

“We are proud to be a part of the Endeavour Awards for

That success is what drives our core values as we

Innovation is also an integral part of a company’s

focus on the future through the education of Industry

the 10th year, sponsoring the Environmental Solutions of the

success. At SEW-EURODRIVE we pride ourselves on

Safety Specialists who understand the industry language,

Year award. At Atlas Copco, we believe that the integration

our ability to provide customers with innovative drive

the processes involved and the challenges faced.

of social and environmental responsibility is an important

solutions for their applications.

part of creating long lasting value for our customers and

This is why we are proud to be sponsoring the Most

The result is innovative, powerful products and systems that provide our customers the highest level

shareholders,” says Alain Lefranc, General Manager, Atlas

Innovative Company at the 2014 Manufacturers’ Monthly

of safety while increasing machine productivity and

Copco Compressors Australia.

Endeavour Awards.

reducing downtime. We understand your needs.

Atlas Copco Compressors Australia 02 9621 9999 www.atlascopco.com.au

manmonthly.com.au

SEW-EURODRIVE 03 9933 1000 www.sew-eurodrive.com.au

SICK 1800 334 802 www.sick.com.au

Manufacturers’ Monthly MARCH 2014 17

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LaserTECHNOLOGIES The latest directions in laser cutting The improvements in laser cutting technology keep on coming. Matt McDonald takes a look at the current state of play.

basically just people off the street. They might shake the parts out of a cut sheet, put the scrap in the bin, pile the parts up, and count them. “If they get that wrong they get the sack and the boss finds someone else. That’s about the level of skill they need.” According to McHugh, remote diagnostics have also had a big impact. For example, he said, on a CO2 machine a service technician can now plug in to check the output coupler temperature. If it’s too high he’ll receive a warning. And (also on CO2 machines) lens monitoring can be used to stop the machine before the lens blows up. “These things weren’t dreamed of 25 years ago but now they’re just the norm,” McHugh said.

ASERS have come a long way and there are more developments on the horizon. At present, the focus is on automation, acceleration, software, higher power, reliability, and stability. Manufacturers’ Monthly caught up with Dave McHugh and John Douglass from LMC Laser Services to discuss where the industry is right now.

Fibre v CO2 Fibre laser cutters caused a big stir when they first arrived on the scene and, as a result, some predicted the quick demise of CO2 cutters. However, CO2 machines still do have their place. According to McHugh, this is because fibre lasers are not the best at cutting carbon steels. If you want to cut thick carbon steel, with only oxygen as the assist gas, you should use a CO2 laser cutter. In addition, because of the different wavelengths involved, a CO2 can cut plastic but a fibre machine can’t. Still, the attractions of fibre laser cutters can’t be ignored. “The day will come when fibre will take over CO2. When that day is...your guess is as good as mine, but each year they’re coming out with more powerful fibre lasers,” McHugh said. “The beauty of fibre lasers is they don’t have output couplers or optics or a mirrored beam delivery system such as the CO2. The more mirrors you have in the system the more difficult it becomes. “The fibre lasers are actually bullet proof really. There are lens windows to protect the lenses. The lenses rarely even need to be changed. “The only negative about them is the black box power supply. When they do fail it is going to be expensive.”

Safety Safety is a serious issue with fibre lasers. But, according to McHugh, European machines have addressed safety issues very well. 18 MARCH 2014 Manufacturers’ Monthly

Acceleration

European manufacturers such as Bystronic see safety as a very high priority. “Most European machines are CE and they’re all fail safe. There are systems within systems within systems that shut the thing down [when issues arise].” “That is not true for all cases. We hear some amazing stories about cheaper machines – particularly fibre machines and safety. It’s rather a concern actually.”

Software and automation “The best thing to happen to lasers over the years is basically software. We call them lights out machines and they are truly lights out machines...,” McHugh said. The machines have an inbuilt failsafe and can be left running at night. If there is a problem of some sort and they can’t keep going, they go into shutdown. The operator presets a shutdown time of, say, 20 minutes. If the machine can’t reset itself after that time, it shuts down. The controller

just runs in single phase and no significant amount of electricity, gas, (or money) is wasted. And the machine can email the operators with any problems. Then it is up to them to decide if they want to come in and fix it. But the benefits of automation also extend to day operations. Laser cutting machines can now change their own nozzles, centre the nozzles, handle the heads and so forth. “These days, there isn’t much for the poor old operators to do. They are broom pushers most of the time,” Douglas said. According to McHugh, the “guys that design these machines are so far ahead of the game, computer power is the thing that is stopping them now.” “In the good old days ten years ago the operator had to actually know something about the operation of the machine,” Douglas said. “In Europe now a lot of the so called machine operators are

Computer speed and power has made higher acceleration rates possible. Why does acceleration matter? Isn’t it all about speed? Not for all jobs. Some jobs involve a lot of stopping and starting just because some objects have a complicated shape. “If you imagine [manufacturing] something like a saw blade where it’s all stop, start, curves, it’s the machine’s ability to get up to those cutting speeds that matters,” McHugh said. Of course speed is important, but it’s being able to get up to those high cutting speeds in a short amount of time, then stop and get up to speed again, that lets you make a saw blade quickly. [Matt McDonald, a Manufacturers’ Monthly journalist, writes on a broad range of topics. His special interests include Safety and Industrial Relations. Contact him at google.com/+MattMcDonald28] LMC Laser Services 03 9555 5525 www.lmclaser.com.au manmonthly.com.au

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Laser TECHNOLOGIES Laser rangefinder and app 

Displacement sensors



Strain Gauges



Load Cell & Torque sensors



Pressure & Level sensor, switch



Pressure & UV Light Distribution Films



Tilt sensors & Inclinometers



Accelerometers



Signal conditioners



Digital panel meters



Package leak tester



UTMs



Wireless sensors



Colour sensors



Inertial gyros



Data loggers & DAQ



Teaching Equipment

2D/3D laser line scanner for automation

- Civil, Mechanical, Chemical, Elec. - Hydraulics, HVAC, Process Instr. ...

Bestech Australia MEL: 03 9540 5100

SYD: 02 9624 4233

QLD: 0430 810 220

Enquiry@bestech.com.au

ww.bestech.com.au HO.: U14, 44 Garden Bvd. Dingley VIC 3172 20 MARCH 2014 Manufacturers’ Monthly

Individual values can be pulled together in one line with the tap of a finger.

THE GLM 100 C Professional laser rangefinder is designed to provide tradesmen with a fast, easy and smart way to digitally transfer measured data direct to their PC, tablet PC or smartphone. The “C” in the name stands for “Connectivity”. The laser rangefinder features an integrated Bluetooth interface, which transfers and stores measured values to smartphones and tablet PCs with Bluetooth Classic (Android from version 2.3) and Bluetooth Low Energy (iPhones from version 4S, iPads from version 3). Data can also be transferred via micro USB cable to a PC. The stored measured value list of the last 50+1 measurements can be exported in the form of a table and then read out and processed on a computer. The values feature a date and time specification, making them quick and easy to allocate. The laser rangefinder integrates with the Bosch measurement camera app. Synchronisation enables a measured value to be transferred directly into the desired photo dimension. This is intended to save time and eradicate errors resulting from manual transfer. All functions of the rangefinder can also be controlled remotely from a smartphone or tablet. Bosch Group 0395 415 555 www.bosch.com.au

BESTECH Australia has introduced a compact (96 x 85 x 33mm), lightweight (380g) laser profile scanner. The scanCONTROL 2600/2900 optoelectronic sensor features an integrated controller, flexible installation and interface options. Small enough to fit in your pocket, the scanCONTROL 2600 offers a measuring rate up to 640 points per profile whilst the scanCONTROL 2900 offers up to 1280 points per profile. Up to 4000 profiles per second can be transferred to a PC for further processing. The measuring range starts at a distance of 53 mm from the sensor and can be extended up to 390 mm. Data transfer and configuration of the sensors can be done via software including LabVIEW, in which a 3D model can be generated.

The scanners are recommended for automotive production or when sensors are mounted to robot arms.

The scanners are particularly suitable for applications that require a low sensor weight yet high-precision profile and dimensional measurements. For example, in automotive production or when sensors are mounted to robot arms. Bestech Australia 1300 209 261 www.bestech.com.au manmonthly.com.au

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Compressors& PNEUMATICS How to reduce the cost of compressed air With electricity costs at an all time high, there are a number of areas manufacturers can focus on to reduce their spiralling compressed air generating costs. Alan Johnson reports.

HILE many manufacturers get fixated with the capital cost of an air compressor, if they looked a little deeper they would see that the largest cost related to producing compressed air is in energy usage. And in a manufacturing plant, this typically represents the highest energy usage. It is an area which businesses should address as a priority to achieve substantial savings. According to Rod Peirce, Southern Cross Compressors’ General Manager, the approach to lower cost compressed air should include sound technical advice; selection of the right unit for the application; the appropriate control system, air quality and set pressure; adequate ventilation and a clean environment; appropriate servicing and a preventative maintenance program. “A correctly sized and designed downstream reticulation system free from leaks is also vitally important,” Peirce said.

Air audits Experts estimate that up to 50% of energy used in producing compressed air is wasted, so an air audit of a manufacturing plant makes good business sense. The experts also estimate that around 10% of the world’s energy is used to generate compressed air, and with energy costs rising at an alarming rate, even the smallest improvement in efficiency can result in significant power cost savings. According to Peirce, the initial purchase price of an air compressor typically represents between 5% and 10% of the lifetime cost of owning and running a compressed air system, when calculated over a ten year period. While 20 years ago air compressors were big, heavy and cumbersome with a long life expectancy there was little consideration to energy efficiency. Compressors today are cheaper, lighter, energy efficient and 22 MARCH 2014 Manufacturers’ Monthly

FASTFACTSFASTFACTS

Tackling compressor costs • Select the correct unit for the given application. • Air audits of manufacturing plants make good business sense. • Identify peak demands, low points and variability throughout different shifts. • Detection of air leaks can dramatically improve performance. have components designed to provide value for money over a shorter period of operational life - usually ten years. Peirce says the initial equipment selection is therefore a key element and a full audit prior to capital investment in this plant will take in a broad study of the compressed air requirements rather than just the compressor. “It looks into areas such as the air demand on each shift, load profile, the operating environment, air quality and the pressure required. Plus it looks at the company’s installation and servicing requirements; the air service lines or reticulation system; life expectancy; reliability; future plans and safety issues; and more. “With many apparently cheap compressors on the market, key features to look for are a direct drive (no gears) air end; high efficiency (MEPS2 compliant) known brand motors and high quality electrics; a laminar flow intake controller; large ‘single pass’ coolers; 316SS control lines; and solid piping or stainless braided hoses,” he said. A simple start, says Peirce, is to take an inventory of the current equipment; and to understand the production requirements and how compressed air impacts on this. “Of particular importance is a comprehensive check of the air reticulation lines, because if you can hear a leak it’s already costing you around $360 - $400 per year. “Other areas include the development of a leak management

Advanced ultrasonic flow meters can be connected to the outside of a pipe, offering zero pressure drops, no process interruption, high accuracy, resistance to dust and humidity, and reduced installation time. program using ultrasonic leak detection, eliminating any improper uses of air through bad work practices, shutting down the compressor when air is not required and setting the air line pressure to meet the production line requirements. All these areas will save money. For example, a reduction in pressure of just 50kPa can represent savings in the order of 4% per year,” he said. “Compressed air is expensive and does not end with the initial

purchase and commissioning of the compressor,” said Peirce. “For example, a 37kW motor operating for 4,000 hours with a power consumption of $0.12c/kWhr at 95% efficiency operating at 100% loading is calculated to cost almost $19,000 per annum to run and that is serious money for any company,” he said.

Hidden efficiency opportunities While compressed air is one of the most expensive energy sources manmonthly.com.au

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Compressors & PNEUMATICS

A data log graph from data using a flow meter. used in industry, Peirce says due to inefficiencies in most compressed air systems, 20-30% of the generated power is lost before it even reaches M Ause. 0 3 1 4 _ 0 0 0 _ BOG1 . p its end “Another 10% is lost to artificial

demand caused by higher than required operating pressures and a further 10% is lost due to end use equipment using air when dproduction f P a g is e turned 1 2off. 9 / 0 1 / 1 4 , “These facts are surprising to

most people but they highlight how inefficient a compressed air system can be, particularly with rising electricity costs, as the more 8 : 3 0 : the 1 0 system A M the AE D T power inefficient more is consumed,” explained Peirce.

“This builds a strong case for every compressed air user to define a flow profile to identify peak demands, low points and variability which occurs throughout different shifts. “For example, if a plant is closed overnight with no production and the compressors are not shut down, a flow meter may show that there is still some air being leaked representing inefficiencies in the system that can be addressed. Equally it will identify if the right compressor is being used for the application,” he said. “In the past flow meters have been intrusive, requiring the cutting of pipes to install into the air system. Today we can take advantage of the latest technology in advanced ultrasonic flow meters connecting to the outside of a pipe only, resulting in benefits such as: zero pressure drops, no process interruption, high accuracy, resistance to dust and humidity, and reduced installation time. “Ultrasonic flow meter technology used to build an accurate flow profile creates opportunities to reduce a company’s energy costs significantly.

ADVERTORIAL

The BOGE brand – First Class Engineering made in Germany BOGE Compressors Australasia is a wholly owned subsidiary of the BOGE German parent company that has been in operation for over 105 years. The Australian subsidiary is the sole importer and wholesaler of the German engineered BOGE products for Australia, New Zealand, PNG and Fiji. The BOGE compressors, dryers, filters, spare parts and ancillary equipment are sold through a very strong distributor network covering all areas. In fact intense regular training is provided and the product can only be sold by a business that has the technical expertise to support and service the product. BOGE Australasia also has an engineered division catering specifically for the manufacturing industry and plant can be provided for unique applications including skid mounted packages, marine class paint for external use, higher IP ratings for electrical cabinets, air intake and outlets or even high temp applications. Machine packages can also come fully self contained in complete containerised solutions. Remote locations are also supported by the BOGE service department both in Australia and a direct overseas line if needed. Technical support for on-site personnel is only ever a phone call away. Remote monitoring is also possible with the BOGE controller technology.

including the direct drive complete CL Air Centre and the high demand Oil Free K series piston compressors.

While larger machines may be required for manufacturing applications BOGE also engineer first class smaller machines for workshop or instrument air

For all enquiries please contact BOGE Compressors 03 5940 3266 or visit www.boge.net.au

24 MARCH 2014 Manufacturers’ Monthly

One of the Boge manufacturing plants located in Bielefeld, Germany

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Compressors & PNEUMATICS By creating a baseline profile it can be compared to future profiles to see how air demand changes over time, enabling the company to make informed decisions on equipment and system design,” Peirce said.

Detecting air leaks

With most air leaks inaudible to the human ear, Peirce recommends companies use ultrasonic detectors to identify air leaks. “An air leak as small as 1.6 mm in diameter is not only inaudible to the human ear it can cost around $450 per year in wasted energy,” he said.

Air leaks can have a drastic effect on compressed air system performance. Each air leak leads to wasted output, ultimately increasing compressor demand, energy usage and energy costs. They can also have a significant affect on production by causing system pressure drop, impacting plant and equipment efficiencies, shortening the life of equipment through more frequent cycling, increases in running time leading to additional maintenance, and added unnecessary compressor demand. “Air leaks can come from any part of the compressed air system including sources such as couplings, hoses, tubes and fittings, pressure regulators, open condensate drains M A 0 3 valves, 1 4 _ 0pipe 0 0 joints, _ BOG2 . p and shut-off

A comprehensive compressed air audit recently undertaken at Godfrey Hirst’s Victorian carpet manufacturing plants identified cost savings of up to 50% on its compressed air energy costs plus many environmental benefits. Peirce said the brief was to identify opportunities for improvements in efficiency, reduce operating costs and at the same time further improve the company’s environmental footprint and sustainability. “The review included a complete compressed air audit and analysis of both the supply and demand side at sites within Victoria. “On the supply side this involved dreviewing f P a gthe e size 1 of 2the 9 /compressors, 0 1 / 1 4 ,

receivers, supply pipe dimensions, pressure settings and the method of control. Critical ventilation and maintenance programs were also studied to allow recommendations to be made,” he said. “The demand side audit reviewed piping to point of use, identifying air leaks, incorrect pressure settings, pressure drops and inappropriate uses.” Using ultrasonic flow meters, technicians were able to determine the exact air flow and usage profile on each line for each shift on all sites studied. 8 With : 3 1dramatically : 4 4 A Mvarying A E Dloads, T

disconnects and thread sealants.”

their installation, filters, dryers and

profiles were then established to

Cost savings

Using an ultrasonic detector to identify air leaks.

identify more suitable, cost effective equipment to ultimately achieve maximum efficiency. Peirce explained that the air leaks on the demand side were identified with every leak tagged, photographed and detailed in a report providing information on leak volumes, corresponding kW’s wasted and annualised energy costs. “As a result of the audit, air leaks alone were identified as costing the company thousands of dollars per annum in wasted power and with energy costs escalating, this would only increase. Overall, the air supply side audit identified additional savings through the use of more efficient modern compressors, common issue opportunities, oversized compressors in use, inefficient or non-existing sequencing between multiple compressors, flow imbalance between main air lines, incorrect pipe sizing causing pressure drop, incorrect pressure settings and undersized air receivers. Southern Cross Compressors 1300 372 056 southerncrossaircompressors.com.au

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Fixed Speed or Frequency Controlled, Belt Drive and Direct Drive Compressors from 4hp, 15cfm to 480hp, 1500cfml

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Manufacturers’ Monthly MARCH 2014 25

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Compressors & PNEUMATICS

The importance of regular servicing While many manufacturers assume that a modern air compressor will run forever without problems, in fact everyone needs a little TLC. Edwin Wong reports.

ITTING away in a quiet corner of every factory floor is the ever reliable air compressor. It’s often operational 24 hours a day and there is a casual ignorance of its weighty contribution to the production process. For when a breakdown does occur in a compressed air system, production often comes to a complete halt. This makes that overlooked servicing and maintenance a very costly long-term strategy. According to Ulf Torpman, Kaeser Compressor’s National Service Manager, companies which neglect their air compressors soon learn an expensive lesson. “Today’s air compressors are incredibly sophisticated machines. They are not cheap to purchase and yet people think its OK to take shortcuts with servicing and maintenance to cut costs,” Torpman said. “Companies who regularly service their air compressors will avoid untimely and costly production downtime due to compressor breakdowns; plus they will also increase the total life-cycle of their compressors.” Torpman said good servicing starts with good customer support. “This is achieved by having a deep understanding of the customer and

Servicing is more than just changing the oil and filters on a compressor. It should include the auxiliary equipment such as ducting, pipe works, drains, filters, control modes and controller. formulating a complete overview,” he said. “Customers should expect their compressors’ service operators to conduct meticulous site inspections with a formulated checklist that will provide them with an inclusive overview of all their compressed air operations. Torpman claimed that some of his contemporaries take a narrowminded view of servicing. “Not only should they change the oil and filters on a compressor, but

they should look at the auxiliary equipment such as ducting, pipe works, drains, filters, control modes and controller,” he said. Torpman said flat fee servicing is increasingly gaining traction as a viable and attractive servicing option for many customers. “It works by formulating a servicing agreement between parties for a set number of years to conduct minor and major servicing and maintenance at regular intervals throughout the year. It usually also

covers the costs of spare parts to the whole compressed air system,” he said. “If you have flat fee pricing, the customer knows the costs in advance and he can budget for the financial year.” Torpman said flat fee servicing eliminates the variance and uncertainty that would normally accompany the running of the air compressor. “The customer is billed regularly instead of having to process larger invoices at irregular intervals, plus the customer can rest assured that we will take care of the compressor station,” he said. “As a supplier, we know and can plan the maintenance to the smallest detail; which saves both money and time for the customer and us.” Torpman said standard service intervals are approximately every 3000 hours. “Energy costs taken over the lifetime of any compressor can add up to 70% of the initial capital cost. Investing in an efficient compressed air system combined with a preventative maintenance program has the highest impact on reducing energy consumption than any other factor,” he concluded. Kaeser Compressors www.kaeser.com.au

Super Cushion air springs PIES Australia has available the Goodyear range of Super Cushion air springs. The high strength rubber/fabric flexible air containers are sealed by retainers at each end and are said to cost about half as much as air cylinders and about one-fifth as much as hydraulic cylinders. According to the company, they are easy to install, require little maintenance and often have a longer service life than air cylinders. And unlike air and hydraulic cylinders, no lubrication is needed since there are no sliding seals to wear out and a misalignment of up to ten degrees can be tolerated by the rubber flexmember. They are also said to be responsive enough to handle high speed, positioning, clamping and stitching operation on heavy-duty equipment. 26 MARCH 2014 Manufacturers’ Monthly

In air actuation, a single Super Cushion air spring is designed to provide up to 17,000 pounds of linear force and a stroke up to 20”. In addition, they can be operated vertically, horizontally or at an angle. They are capable of rapid actuation and can be applied to produce rotary motion. In vibration isolation, the air springs are designed to isolate more than 99% of unwanted vibration, and are recommended for shock absorption and load height control. In many applications an air spring is used for both actuation and vibration isolation. For example, in a vibrating compactor, the air spring actuates (extends) to lift a carton off a roller conveyor, vibrates to compact the contents of the carton, then de-actuates

The air spring actuators can provide actuation using air, water, bottled nitrogen gas or antifreeze solutions. (compresses) to set the carton back on the roller conveyor. The cycle is then repeated as the next carton rolls down the conveyor. PIES Australia 03 9303 2000 www.piesau.com.au manmonthly.com.au

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Air Compressor News

Have you ever been dissatisfied with the service for your Air Compressor? If the answer is YES call:

1800 853 133

Flat- fee servicing 24/7 service for all brands Australia wide coverage Total responsibility package for Kaeser units

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Compressors & PNEUMATICS Energy savings make compressor decision easy

With the cost of electricity continuing to rise, Australian manufacturers are increasingly looking to improve their competitiveness by investing in more efficient air compressors. Alan Johnson reports.

MA 0 3 1 4 _ 0 0 0 _ P I E

technology and save money. HEN Tom Davies, General Davies explained that the Manager of Aquaknect Flexible, Australia’s leading company had been using old technology; three old and inefficient manufacturer of flexible connectors, Hydrovane compressors. was looking to replace the company’s “Now we just have the one latestageing compressors, he decided to generation compressor, instead of invest in Atlas Copco’s revolutionary three,” he added. new VSD (Variable Speed Drive) Started in 1986, Aquaknect compact oil-injected rotary screw air Flexible is Australia’s oldest compressor – the GA VSD+. manufacturer of flexible connectors “Reduction of running costs, and is now the only manufacturer of reliability and cleaner air delivery flexible connectors in Australia, with were the key features why we chose around 35 employees. the new air compressor for our “While we do have a Joint Queensland manufacturing facility,” Venture operation in China, the other Davies said. companies have shifted all their Like most manufacturers in manufacturing operations off-shore, Australia, the ever-increasing cost of particularly to China and India. electricity was a huge factor when “By having our manufacturing deciding on a new compressor for his operation in Meadowbrook, manufacturing plant. Queensland, this allows us to tailor“We looked at four other make hoses for our customers’ companies with similar styles of 1machinery, 2 0 1 4 but - 0in 2 the - 0 end 3 T it1 was 0 : an 3 8 : 1 specific 0 + 1 1 requirements : 0 0 with very short easy decision to go with the latest

turn around times.”

Davies explained that the company uses the compressed air to drive its crimping and cutting machines as well as vital testing equipment. “It’s critical we have a reliable supply of clean air to operate our machines, without them we have no hoses,” Davies said.

Power savings Duncan Vaughan, Sales Engineer with Atlas Copco’s Queensland Industrial Air Division, said that while Aquaknect Flexible was the first company to invest in the GA VSD+ air compressor in Australia, he is expecting many more manufacturers to follow their lead as word spreads about these ultraefficient compressors. “These are brilliant machines. The power savings alone are significant enough to justify investing in a new machine. Plus the

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new compressor delivers far more air, better air quality, and far more efficiently than what the company had in the past.” Vaughan explained that the radical new GA VSD+ was officially launched in Australia in October 2013, but he was able to install this compressor a couple of weeks prior to the launch. “It has only been installed for a couple months now, but it is clear the compressor will deliver the savings predicted. Early figures show considerable energy savings already,” he said. Vaughan said the GA VSD+ compressor offers a major leap forward in FAD (Free Air Delivery) with improvements of up to 12%, and a breakthrough in energy-efficiency requiring on average 50% less energy than a comparable idling compressor. “Plus it’s much quieter than the old Hydrovanes, and other air compressors on the market; down to M A 0 3 1 4 62db(A). _ 0 2 9 _ AT L an unbelievable “In fact it is so quiet that when

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the compressor was first installed, the workers at the plant often forgot to turn the compressor off at the end of their shift, even though the compressor is in the work area, up on a mezzanine level. “To overcome the problem, we simply programmed the machine to turn itself off at the end of every day,” Vaughan said.

All new Vaughan explained that with the GA VSD+ compressor, Atlas Copco started with a clean sheet of paper back in 2007, and evaluated every part of an air compressor. “Suitable for a wide range of industries, this radical new rotary screw compressor is driven by a high Atlas Copco’s new compact GA VSD+ air efficiency IPM (Interior Permanent compressor is so quiet (62dbA) it can be Magnet) motor, which exceeds IE3 placed in the work area. rating at 94.5%; corresponding to at low speeds for reliable start-up IE4 (Super Premium Efficiency under pressure, making it ideal for motor class).” the GA VSD+ compressor, which only He said the motor is highly 1efficient 2 0 1 over 4 - 0a wide 2 - 1range 2 T 1of 1 power : 5 2 : 0 runs 3 + 1when 1 : needed. 0 0 loads, and produces high torque

The compact motor features

optimal oil cooling and an oillubricated motor bearing all in a sealed unit, meaning no greasing of bearings or airflow required for cooling of the motor. And unlike traditional compressors, the motor and drive train share one drive shaft and are vertically aligned to allow a smaller footprint of 55% compared to the previous range. There are also no gears, belts or shaft seal to maintain. The whole drive train is completely closed, offering IP 66 protection, with one oil-circuit that cools the motor and lubricates the element and bearings. Vaughan explained that the GA VSD+ compressor is now available in a wide range of sizes from 7kW up to 37kW, and at no extra cost to the equivalent GA VSD compressor, which will continue in production alongside the new GA VSD+ model. Atlas Copco 1800 023 469 www.atlascopco.com.au

Manufacturers’ Monthly MARCH 2014 29

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Fasteners& ADHESIVES Epoxy compounds getting tougher Because they can stand up to challenging cyclic loads and cure with low residual stresses, toughened epoxies are now being used to bond, seal or encapsulate a wide variety of electronic, optical and medical components. Jane Trager reports.

ITH adhesive products, high performance and rigidity are often thought to go hand in hand. And it is true that the very best strength, thermal, chemical and electrical properties tend to be found in rigid compounds, especially epoxies. Yet there is a growing class of adhesives, sealants and coatings that add ductility to the long list of desirable epoxy properties. These “toughened” epoxy compounds can be created in a variety of ways. Toughening sometimes involves the incorporation of ductile rubber or thermoplastic materials into epoxy’s normally rigid molecular backbone. These ductile materials may remain in the epoxy compound as distinct phases, absorbing shear or impact forces. Carboxylterminated butadieneacrylonitrile (CTBN) copolymers are one family of ductile materials that Master Bond has used to great advantage in a variety of toughened compounds. Other toughening methods rely on specific diluents or other reactive elements to change the epoxy’s molecular structure in ways that make it more flexible – for example, by reducing the crosslink density or by shortening molecular chains. Heat cure schedules can also be manipulated to improve epoxy ductility. Every toughening method has its advantages and disadvantages,

30 MARCH 2014 Manufacturers’ Monthly

but they all address the chief shortcoming of epoxy compounds. For all their first-rate mechanical, thermal and chemical properties, conventional epoxies can sometimes be too rigid for use in structural applications subject to extremely heavy fatigue, impact or thermal shock loads. Toughened epoxies have no such Achilles Heel. They can be used in scores of electrical, optical and medical applications where rigidity might otherwise prohibit epoxy usage.

Performance benefits When comparing a toughened and conventional epoxy, the mechanical property difference that jumps off the data sheets is elongation. Whereas a traditional epoxy will have elongations of less than 5%,

FASTFACTSFASTFACTS

Toughened epoxy compounds • Conventional epoxies can sometimes be too rigid for use in structural applications. • Toughened epoxy compounds can be created in a variety of ways. • Toughened epoxies can be used in many electrical, optical and medical applications. • There is a large number of different toughened epoxy products available.

Toughened epoxies offer enhanced resistance to vibration, impact, shock and thermal cycling.

toughened epoxies typically have elongations that fall within the range of 50 to 80%. This elongation improvement represents a huge increase in ductility, which allows the adhesive to withstand impacts and “flex” under cyclic loads caused by fatigue or temperature swings. Lastly, toughened compounds tend to cure with lower residual stresses than their more rigid counterparts. Unlike conventional expoxies, they often have residual stresses approaching zero. Ultra-low-stress curing is particularly important when bonding or encapsulating delicate electronic, optical or medical components. These components are often made from materials whose yield stresses are far below the

residual stresses possible with standard epoxies, making them susceptible to damage. In optical applications, residual stresses can cause additional problems by misaligning components or inducing birefringence. With toughened compounds, ductility does come with a small trade-off related to maximum service temperature. While high temperature epoxies can withstand intermittent temperatures above 300°C, toughened products top out at about 200°C intermittent. Reductions in typical continuous use temperatures are similarly about 100°C. This loss of thermal properties, though seemingly significant, does not have widespread practical implications since the vast manmonthly.com.au

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Better. Enough said

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Fasteners & ADHESIVES properties, and bond strength are all comparable. Finally, toughened adhesives offer excellent adhesion to many metal, plastic, glass and rubber substrates. And in the case of rubber and elastomeric substrates, toughened compounds are often a necessity. Putting a rigid compound between flexible substrates is a recipe for failure. How toughened epoxies stack up.

Applications

majority of bonding, potting and coating Thanks to their ability to accommodate applications do not require anywhere near challenging load cases, toughened epoxies the maximum temperature. are gaining ground in a wide variety of At very low temperatures, which applications. tend to magnify any ductility issues an Many of them involve the bonding, adhesive might have, toughening actually sealing or potting of electronic and optical imparts a performance advantage. components, which can be sensitive to the Nearly all cryogenically serviceable very issues that toughened compounds epoxies, some of which have to withstand address: impact, vibration, thermal cycling temperatures as low as 4K, have some sort and stresses. of toughening agent. Toughened compounds are also available Other than the differences in thermal in versions that offer speciality properties, properties, toughened epoxy compounds which opens up applications that require do not differ significantly from their ductility in conjunction with other unmodified counterparts. functional attributes. Masterbond To take three key property examples, MA 0 3 1 4 _ 0 0 0 _ T E S 1 2 0 1 4 - 0 2 - 0 6 T 1 5 :www.masterbond.com 2 1 : 2 2 + 1 1 : 0 0 the chemical resistance, electrical

122 x 100mm

Self-amalgamating tape A STRONG selfamalgamating tape made from silicone which bonds without adhesive has been released by tesa. The 4600 Xtreme Conditions tape is applied with tension by wrapping the tape around itself. The bondage of the tape on its own backing is The bondage of the tape on its own designed to create a waterbacking is designed to create a tight, permanent sealing, with water-tight, permanent sealing. no drying time required. According to the company, its flexible material can be applied smoothly on any kind of surface, including wet or warm, dirty or oily. The tape can be used also for temporary applications leaving no residues after removal, and can be applied under water, the company says. Due to its silicone backing, the tape is said to have an excellent resistance to various chemical substances, oils, acids, solvents, salt water, UV radiation and extreme temperatures. tesa tape Australia 02 9830 3939 www.tesatape.com.au

Non-hazardous anaerobic adhesives LOCTITE has expanded its health and safety range with three innovative anaerobic products; the retaining adhesive Loctite 6300 for cylindrical assemblies, gasketing product Loctite 5800, and the thread sealant Loctite 5400. The company is the only one to offer a complete portfolio of non-hazardous anaerobic adhesives. Loctite introduced its first two anaerobics with a “white” material safety data sheet in 2009: the threadlockers Loctite 2400 and Loctite 2700. The three newly developed Loctite products also contain no hazardous ingredients. This means that by expanding its Loctite according to the tough regulations of (EC) No. 1907/2006 – ISO 110141, they do not have to be labeled with any hazard symbols, risk or safety phrases. Nor do they contain any declarable CMRs (carcinogenic, mutagenic and reproductive toxins). The non-hazardous adhesives are said to provide solutions with all the accustomed power and performance for many kinds of metal joining applications.

32 MARCH 2014 Manufacturers’ Monthly

The three newly developed adhesives also contain no hazardous ingredients The high-strength retaining product Loctite 6300 has a green fluorescent colour, a viscosity of 350 mPa and a shear strength of 20N/mm². Loctite 5800, a thixotropic, medium-strength gasketing product, has a red fluorescent colour, a viscosity of 150,000mPa and a shear strength of 12N/mm². The yellow fluorescent, medium-strength thread sealant Loctite 5400 is also thixotropic, has a viscosity of 27,000mPa and a breakaway torque of 19Nm. Loctite 1300 885 556 www.loctite.com.au manmonthly.com.au

MA0314_000_REE

2014-01-31T09:54:23+11:00

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LEDLIGHTING Light relief LEDs are now capable of serving a wider range of applications, so doing your homework will help you choose the appropriate fixture. Sarah Falson writes.

HETHER you are using light emitting diode (LED) fixtures in OEM applications or simply to light your work space, the technology offers the latest in energy efficiency lighting options. However, with LEDs now suitable for a wide variety of applications, product quality can vary, and sourcing those that live up to expectations can be tricky – not to mention costly. “The first areas for high-output white LED luminaire developments were smaller, less powerful street lights, commercial lighting applications such as downlights and architectural coloured feature lighting. For the past five years lighting manufacturers and component suppliers have been working closely to capture the exciting opportunities high-output LEDs now provide the manufacturing sector,” Wadco Lighting general manager, Robert Day, told Manufacturers’ Monthly. According to Day, LED industrial light fitting design and development has been driven by two major industry groups: electronics component companies, and traditional industrial light fitting companies. This has led to an influx of a wide variety of industrial LED light fittings becoming available in Australia from existing and new overseas suppliers. 34 MARCH 2014 Manufacturers’ Monthly

FASTFACTSFASTFACTS

LED selection criteria: • Horizontal and vertical light output and distribution • Control of visibility glare • Colour temperature and rendering • Energy savings • Ambient temperature rating of the fitting and thermal cut out protection • Warranty on the LEDs and Electronic Driver • Dust / water ingress protection • ROI cost of ownership for 10 years • Future proof design and technology • Modular component replacement and reverse compatibility for new models • Options for DALI and Analogue 1 to 10 volt dimming • Microwave movement sensor dimming • Control system software and commissioning • Government Energy Savings Scheme Rebates “The manufacturing sector in Australia has high standards in occupational health and safety rules and regulations, building codes and Australian Lighting Standards. Light fitting designers must consider horizontal and vertical luminance and glare control, and newer LED fitting designs are now incorporating a wider variety of narrow and wide light distributions and the use of cut-off reflectors or refractor lenses to control glare whilst properly managing heat conduction and

Wadco’s Metrolux LED 240-watt fixtures were successfully installed in a local poultry meat processing plant to replace the existing 425-watt metal halide fittings, providing the same light levels and saving energy.

convection,” he said. “Manufacturing lighting applications typically require light levels range from 80–160 lux for occasional inspection or reading, all the way up to the 400–600 lux, depending on the size and frequency of the task. “New LED technology with electronic control gear is naturally more expensive, but manufacturers in Australia running their light fittings for long periods of time have been able to take advantage of this new LED technology through energy savings ROI (return on investment) analysis and State Government energy savings certificate rebate schemes (currently available in NSW and Victoria). Manufacturers running shift work have a faster ROI and have taken up the new LED technology more rapidly.”

LED developments Tenrod Australia managing director, Rodney Lai, agrees that continuous developments are making LEDs more efficient, offering more light for less power. Technology improvements have also made LEDs brighter and more powerful, allowing them to be used in overhead lighting applications. “LED lights turn on immediately upon power up, and off immediately when power is turned off. They do not require cooling down before turning

on again, nor do they require firing-up devices like starters which cause flicker and irritation. They can be switched on and off at will and so save power whenever lighting is not required – no matter for how short an interval,” Lai told Manufacturers’ Monthly. “Reputably-built LEDs should be Reduction of Hazardous Substance (RoHS) Compliant, which means they are mercury- and lead-free and therefore less hazardous to the environment. LED light sources are generally lighter and smaller than other light sources, making the fittings lighter. They also have a much longer service life than others, and can be made to emit different colours – such as stage lighting, wall wash or flood lighting – without the use of filters.”

Uptake issues Clearly, LED fixtures offer numerous user benefits, however the viability of LEDs as replacements for traditional light sources has been manmonthly.com.au

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a hotly-contested topic among manufacturers. “One of the main issues is differentiating between the poorquality LED products and the ones that stand-up to the claims,” Hella Australia Manager – Fixed Lighting & Industries, Craig Middleton, told Manufacturers’ Monthly. “When using a quality LED product, benefits include: energy efficiency; no maintenance for the life of the product; improved colour rendition; greater uniformity of the lit space; and instant start operation.” APS Lighting & Safety Products Company chief executive officer, Jeff Baxter, agrees, adding that LED technology has caused a significant shake-up in the lighting industry, with a large number of new lighting manufacturers and suppliers entering the market in the past five to 10 years. “Rapid development of LED technology is resulting in a much M Aproduct 0 3 1 4lifecycle, _ 0 0 0 _causing TEN shorter

to recoup design and manufacturing Baxter advises those buying LEDs investments before the technology to ask for more than product specs. to used in that fixture is obsolete,” make more informed decisions. Baxter told Manufacturers’ Monthly. “Ask them to provide total cost of ownership comparisons, references “There have also been increased of projects where the products are concerns as to LED lighting safety already working, and light layouts or and the integrity of information and comparisons pertaining to the types consistency in terminology used by of fixtures they are currently using companies in marketing their LED so the buyer can ensure the layouts products. High variability of product meet their lighting standards prior to quality in the market has also led purchase,” he said. to increased buyer risk in choosing 1fixtures 2 0 1that 4 - aren’t 0 2 - optimised 1 0 T 1 6for : 1 3 : 4 9 + 1 1 : 0 0to Baxter, vehicle (in According

an issue for manufacturers’ ability

their application.”

manmonthly.com.au

A Hella RotaLED Beacon undergoes Ingress Protection (IP) testing.

particular off-road), heavy equipment

and accessory manufacturing companies have been early adopters of LED technology. “This has been in part driven by demand from their customers to fitout the vehicles with LED lighting. However, the primary products in this market are work lights, for which there has already been a rapid uptake in the Australian market. Most OEMs are offering LED alternatives on their equipment, and the LED work lamps are offering very real benefits in terms of efficacy, output, maintenance, and lighting control,” he said. Wadco Lighting www.wadco.com.au Tenrod Australia www.tenrod.com.au Hella Australia www.hella.com APS Lighting and Safety Products www.aps-supply.com

Manufacturers’ Monthly MARCH 2014 35

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Materials HANDLING How to get the most out of forklifts A fleet management system can have your forklifts running safely and effectively.

N the world of forklifts there haven’t been any groundbreaking changes in recent times. All the major players, Toyota, Crown, and so forth make good machines that are quite capable of doing the job they are expected to do. So where does that leave companies who want to improve their forklift fleets and improve their ForkTrack offers bottom lines? Manufacturers’ Monthly caught up advanced features with Andrew Satterley, Adaptalift Hyster CEO to such as automatic hear his answers to this question. email alerts. “I think it’s more been around some of the offerID cards); it causes the equipment to shut down on ings that would come with the forklifts,” Satterley impact; etc. said. “It’s the subtle things that are having the bigOn top of that, it includes advanced features gest impact for all the players in this industry.” such as a digital weight indicator, speed and zone For Adaptalift Hyster the focus has been on control, Lift/tilt Lockout, Overload lockout, etc. fleet management. “It even has a really cool feature – the auto“Our tool is called ForkTrack and what that provides to the companies that use it and to the op- matic email alert. It will send emails, depending on the event, to whoever is set up to receive them,” erators is a complete fleet management and safety Satterley said. system for the equipment,” Satterley said. “The recipient will be informed that the forklift For example, it ensures operators put their seatbelt M onAbefore 0 3 1 they 4 _ 0can 0 0start _ Aoperation; D A - it1 records 2 0 1 4 - has 0 2 had - 0 an 5 Taccident; 0 9 : 1 it’s 7 : in0 lockout 0 + 1 1mode : 0 0because the weight is too heavy; and so on.” who is using the equipment at any given time (via.

36 MARCH 2014 Manufacturers’ Monthly

According to Satterley, such systems are where the real advances in forklifts are. By way of example, he pointed to the contract Adaptalift Hyster won with Coca-Cola last year. “One of the reasons we won the Coca-Cola contract this year was based around telemetry and it’s become a big topic for these big warehouses,” he said. “And we’ve been able to reduce the amount of forklifts Coca-Cola have with this product. So we’ve been able to say - ‘We can make it more efficient. You don’t need as much equipment. You just need to use it more effectively.’” ForkTrack is manufactured by Adaptalift Hyster and it is used on all Hyster forklifts sold in Australia. According to Satterley, it has proved successful and Adaptalift is negotiating with Nacco Materials Handling Group (who manufacture Hyster) to make it a standard feature of their products globally. Adaptalift Hyster 1300 758 188 www.aalhysterforklifts.com.au

manmonthly.com.au

MA0314_000_NAC

2014-02-06T15:09:05+11:00

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3DPRINTING 3D printers move into the mainstream Curiosity about and investment in 3D printing just keeps increasing, but what can you gain from bringing the technology into your business’s operation? Brent Balinski writes.

USINESS is booming for the US and Israel-based Stratasys, according to the leading 3D printing and additive manufacturing* company, which recently predicted sales growth of at least 25 per cent for the year. In 2013, the company also acquired the consumer 3D printing firm MakerBot, and saw out the first full year after its completed merger with Objet. The pace in this region is outstripping all the others for Stratasys, ahead of India, the USA and Latin America. “In terms of growth, APJ presented the strongest for 2013,” Jonathan Jaglom, general manager for Asia Pacific and Japan since the beginning of last year, told Manufacturers’ Monthly. “The big player in Asia of course... remains Japan. Second is China, third is Korea and then the rest of the region and the rest [of the countries in] the region are pretty much even in weight, with Australia being one of those.”

What’s behind the demand? In Australia, as with Asia and the rest of the world, there are four main fundamentals driving the rapid growth in investment, according to Stratasys: compression of time to market, the cost of error, creativity, and confidentiality concerns. With a suitable 3D printer, the need to create a prototype via milling or by hand no longer exists. “Today you can generate prototypes directly through a 3D printer from a 3D CAD software environment,” explained Jaglom. What a manufacturer hopes to accomplish through a prototype is important; concept modelling for mainly visual purposes is different to 38 MARCH 2014 Manufacturers’ Monthly

testing for fit and assembly or functional testing. “Functional testing is split around two parts that are basic functional testing: dry runs of the product and its environment and also testing parts in harsh environments,” he explained, adding that being able to produce a prototype out of the right material is a requirement those in the market for a machine will need to consider. “Of course if your end product is polycarbonate and you’re testing on a material which is inferior to polycarbonate then your

When you have a suitable 3D printer, the need to create a prototype via milling or by hand no longer exists.

FASTFACTSFASTFACTS

3D Printing • Demand in Australia and around the world is growing rapidly. • Whether you need to use it should be decided on a case by case basis. • It is suitable for creating concept models and functional prototypes. • It can also be used to manufacture tools and end-use products. drop test analysis is of little value to you,” he said. Being able to spot errors in design earlier can mean an earlier correction and thus less time wasted later. The third factor driving investment – creativity – is harder to measure, concedes Jaglom. But being able to prototype more quickly and at a lower cost to re-design will allow a team to try out more of their ideas in less time. Finally, confidentiality concerns mean that a reason to consider

purchasing a 3D printer might have something to do with hesitation around sharing CAD files and concepts with a third party.

Comparing hype with reality For Stratasys and other companies offering 3D printing solutions, one of the biggest challenges is educating the potential market about what practical gains can be achieved by the capital expense. Another is matching technology with expectations. Along with huge growth, there is a lot of hype and what sometimes seems like a rush by the media to cover

every novelty involving 3D printing regardless of its usefulness. Whether or not 3D printers or production systems are suitable for a given workplace is best decided on a case-by-case basis. Sometimes it means overcoming the hype. “3D printing is magical, it’s fantastic, but it has its limitations,” explained Dominic Parsonson, product manager at Tasman Machinery, one of Australia’s two Stratasys re-sellers. “It’s a production process like any other production process. manmonthly.com.au

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“The first stage of going through when someone approaches us is to determine their understanding of 3D printing. Where does he think he wants to implement it, what are his expectations for a part: is he prototyping for look and feel? Is he looking at functional applications? Or is he looking at production? “So the key issue is first understanding what he expects from a [printed] part.”

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goes way beyond just prototypes. “The production guys will say ‘we could do some low volume parts on this instead of outsourcing’, and the maintenance guy might think ‘we’re running some old machines, we need some bits and bobs we can no longer source’ and then get it. “Assembly teams might say ‘we can produce customised jigs and fixtures which can improve our assembly times in production.’ So the second you have a 3D printer in-house, its value across the whole scope of the organisation increases, from design, prototyping, assembly, production and maintenance.”

There is...a rush by the media to Is Australia lagging behind the cover every novelty rest of the region? involving 3D printing For Stratasys, the biggest challenge is educating those who might regardless of its benefit from 3D printing or additive usefulness. manufacturing, through efforts Parsonson explained that a printer is another tool in the workshop, like an injection moulder or a CNC machine, and will be useful in some cases and not in others.

What uses? According to Stratasys, there are four main uses for their technology, in creating concept models and functional prototypes, as well as manufacturing tools such as jigs and fixtures, and finally end-use products. For a company that’s outsourcing its 3D printing needs, Parsonson says choosing to own their own machine or machines can be the result of simply doing the maths and seeing how the cost of ownership stacks up against using a bureau. According to Tasman Machinery, the more use the investment gets, the more value it adds to a company. “You’ll find that a good company with 3D printing will have their production engineers, their design team, their maintenance team and a variety of teams within the company exposed to 3D printing,” said Parsonson, who added that the value manmonthly.com.au

including its marketing, consulting directly with customers, and through efforts such as putting in appearances at trade shows. Jaglom, a keynote speaker at the Singapore Inside 3D Printing Conference, said that the company will have a presence at the Melbourne leg of the series in July. It will also feature as the exclusive sponsor of National Manufacturing Week’s new Additive Manufacturing zone. Part of the effort to address the curiosity around 3D printing, Stratasys tries to partner with various governments to put forward its technology. According to Jaglom, Australia is lagging its regional neighbours badly when it comes to promoting and helping make available 3D printing to those who could be transforming their businesses with it. “I can tell you that I’m actively pursuing discussions with the Chinese government, the Japanese government, the Korean government, the Singaporean

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government,” explained Jaglom. “I have to admit that in Australia we have not had that sort of discussion.” Jaglom is critical of what he sees as the country’s lack of effort in encouraging industry, comparing Australia poorly with the enthusiasm shown by countries such as the US and China for advanced manufacturing hubs. Compare the situation in Australia with, say, Singapore, whose government announced last year it would invest $500 million over five years in advanced manufacturing, including additive manufacturing. According to Jaglom, there’s no such enthusiasm here. He said his organisation would be happy to discuss this situation with the Australian government. “Maybe they’re talking to someone else, another 3D printing player, and I’m just not aware of it. “As far as we can tell, it hasn’t

yet started. And we’d be delighted to initiate that.” * Though many use the terms 3D printing and additive manufacturing interchangeably and as blanket terms for the entire technology, Stratasys often makes a distinction between the two. 3D printing – though it is the same as additive manufacturing – is typically associated with personalised production on more basic, compact machines, and additive manufacturing with using more complex, more versatile (and expensive) 3D production systems, typically associated with supply chains. [Brent Balinski writes for Manufacturers’ Monthly on a broad range of topics. He has a special interest in 3D Printing and innovation. Contact him at google. com/+BrentBalinskiCirrusMedia] Stratasys www.stratasys.com Tasman Machinery 03 9584 8355 www.tasmanmachinery.com.au

Stratasys offers multi-material 3D Printing systems. Manufacturers’ Monthly MARCH 2014 39

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What’sNew Rotary position sensor

Hot runner temperature control products GAMMAFLUX has introduced three new products in their G24 Hot Runner Temperature Control System product range. The system was designed for use on injection moulding applications, but also for other applications such as controlling thermoforming, blow moulding and extrusion. The new products include: A New Mini Touch-Screen - which provides full feature performance, is windows based and is available for controllers with up to 48 zones. G24 Controller with 12 zones - This is recommended for moulders running smaller hot runner systems applications. It features a half-size control block with 15 amps per zone control. It is available with either the new Gammaflux Mini Touch Screen or the traditional full-featured interface. A new Mould Wizard – a new controller setup and configuration tool which provides fast, easy setup and access to key G24 features. It is available on all Gammaflux G24 controllers. HBM Plastics Technology The G24 Hot Runner 02 8814 3100 A D _ L MH P R I F E B _ 1 3 . p d f P a g Temperature e 1 1 4Control / 0 1System. / 1 3 , www.hbm.com.au

P R O T E C T IN G O UR IT H EN V IR O NM EN T W S a fe -D -C a n t BUND IN G P R O D UC T S

The sensor’s multi-coil system provides high resolution. technology. Unlike potentiometric or magnetic technologies, the sensors incorporate precisely manufactured printed emitter and receiver coil systems. According to the company, the sensor’s multi-coil system provides high resolution, while ensuring 16-bit noiseless operation. TURCK 1300 273 687 www.turck.com

Heavy-duty hose reels

SAFE-D-CANT offers a wide range of spill containment, drum decanting and handling solutions

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40 MARCH 2014 Manufacturers’ Monthly

TURCK introduces the new QR24 rotary position sensor. Designed from the company’s rotary inductive sensor technology, the sensor provides contactless position detection and wear-free performance in a variety of industrial applications ranging from solar energy plants and harvesters to crane vehicles and AGVs. Rotary feedback is critical in nearly every installation, and most rely on their mechanical bearings to provide proper tolerance and position of the internal system. After time, this results in mechanical wear, vibrations, potential leaks and requires spring elements. The sensor is designed for high performance without the need for contact or bearings, allowing it to successfully execute the same functions as an encoder or potentiometer, while eliminating 2 : 0 9 PM wear and extending sensor longevity. The sensor is part of the company’s industry-recognized Q-track family of sensors, which utilise resistance inductive capacitance (RLC) measuring

RECOILA distributes the Reelcraft 9000 Series of heavy-duty hose reel. Their designers have incorporated a dual fluid path into the hose reels in case there is a need to accommodate longer lengths of twin hydraulic hose. This technology also has a heavy gauge base design and is specifically engineered for truck or work bench mounting, a characteristic especially sought after by the mining The reels are equipped industry, energy industry and public works and with full flow swivels. maintenance teams. They handle air, water, oil and grease and there is a choice of 1/2”, 3/4”, 1”, 11/4” or 1 1/2” ID hose. According to the company, the reels provide a high level of stability when used for high volume air, water, diesel fuel and petrol. They are therefore suitable for service trucks and permanent service or plant work areas. All reels are equipped with full flow swivels, low temp Buna seals and incorporate metal forms. They are corrosion resistant and suitable for a wide range of fuels. ReCoila Reels 1300 833 677 www.recoila.com.au manmonthly.com.au

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Brought to you by

Energy-efficient distributed pump drive solutions NORD Drivesystems supplies complete pre-assembled distributed drive units for a wide performance range up to 22 kW. They are said to reduce energy use by up to 60%, reduce noise emissions, lower wear, and increase plant service life. The series comprises frequency inverters tailored to pump applications that precisely adjust power output as required. They are compatible with mains voltages worldwide. The company configures complete drive systems for various application areas (IP55/IP66, ATEX zone 22/3D). Integrated process and PI controller functions enable the fully automated control of process variables and compensation of disturbances – in stand-alone and mobile applications as well as in complex setups with several drives.

Thanks to two analog inputs, the inverters can directly process sensor data such as pressure or flow rate. Optional signal and power plug connectors facilitate handling and ensure compatibility. A programmable energy-saving function automatically reacts to partial load operation. This is intended to increase efficiency and reduce running costs. Operation is straightforward and flexible via control terminals, bus, or via an optional potentiometer that enables adjustments directly at the inverter. To cut setup time, up to four operation modes can be stored. NORD Drivesystems 1300 050 347 www.nord.com

The frequency inverters are compatible with mains voltages worldwide.

LED task light

The sorter is said to allow high-throughput capacity.

Crossbelt sorter DEMATIC has introduced the FlexSort SC3 Crossbelt Sorter, a high rate, high accuracy sorting solution for distribution and warehousing operations. The sorter aims to provide precise positive sorting of satchels, pieces, stuffed envelopes, cartons and totes using discrete belt conveyors mounted on carriers in a recirculating loop configuration. Typical items sorted include apparel, general merchandise, books, CDs, DVDs, electronics, toys, and industrial supplies. Items to be sorted are tracked and controlled through the induction, transport and off-load process with precision. The items are sent to different destinations according to the business rules established for each application. manmonthly.com.au

According to the company, the sorter allows high-throughput capacity and precise controlled handling and operational flexibility, along with sustained order accuracy. The sorter cells can be activated anywhere along the sorter loop. Therefore, it is possible to add and/or move chutes, induction stations, or change the sorter speed without additional hardware installation and commissioning. The sorter is recommended for distribution centre applications such as Batch Pick & Sort, Interlink, Crossdock, and shipping. Dematic 02 9486 5555 www.dematic.com.au

RECOMMENDED for garage, industrial and maintenance applications, the task light is an all-in-one solution that may be used in tough environments. Lightweight, yet heavy-duty, the task light features a patented aluminium head that is designed to dissipate heat. It is protected by an impact-resistant housing which also protects against corrosive fluids and chemicals. The work light includes a white LED light that casts 180 lumens and lasts up to 20,000 working hours. Additionally, it has a multi-position head, hands-free standing base and hang hook to light work spaces from any angle. Using the IR IQV20 Series lithium-ion battery platform, the work light’s cordless battery is compatible with the other tools in the series. When used with the 3.0 Ah battery, the light offers up to 15 hours of runtime on a single-charge and up to eight hours of runtime on a 1.5 Ah battery. CAPS Australia 1300 284 896 MA 0 2 1 4 _ 0 0 0 _ D A T 1 2 0 1 4 The - 0light 1 -offers 0 7 up T to 1 15 5 :hours 4 1 : 3 1 + 1 1 : 0 of runtime on a single-charge. www.capsaust.com.au

WHEN YOUR SYSTEM LETS YOU DOWN Control Systems — When you need an upgrade and / or retrofit ... Servo and VS Drives — When you need repairs and / or retrofits ... Computer Touch Screen Panels — When you need repairs and / or retroPLC Programming and Documentation For fast, professional service; we work with all major brands; Siemens, Allen Bradley, ABB, Emerson (Unidrive and Unidrive SP, Mentor), Mitsubishi, Panasonic, Bosch and many others.

Call now: 03 9874 7737 ww.datafactory.com.au Manufacturers’ Monthly MARCH 2014 41

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The lastword Aim high for Australian manufacturing Australia, writes Barry Thomas, is a nation of pioneers. We should feel proud of inventions like spray-on skin and the electronic pacemaker and we need to continue to encourage innovation.

EARLY one million Australians are employed in manufacturing, contributing more than $106 billion to the economy annually. Indeed, manufacturing is one of the main sources of innovation in Australia and is responsible for a quarter of all investment in R&D. Patent development and manufacturing are different sides of the same coin. A constant pushpull operates, whereby innovation in product design (R&D) encourages innovation in manufacturing processes, and innovation in manufacturing processes encourages innovation in product design. We know that manufacturing is essential to any economy and the vital role it plays in innovation is a key driver of global competition. However, over the past six years we have seen more than 100,000 Australian manufacturing job losses and a further 85,660 are forecasted to go before 2018. The recent announcements relating to the closures of Holden and Ford’s manufacturing plants are a warning sign that something needs to be done to protect the future of Australian manufacturing so it has a sustainable future. Whilst the current R&D Tax Incentive promotes the development of local IP, it does little to encourage the capitalisation of IP through the commercialisation and manufacturing processes. In Australia, the company tax rate is 30%, making it one of the highest in the developed world. This, along with increasing labour costs and the loss of some of the best talent to overseas markets has significantly impacted Australian manufacturing and industry. The risk we face is that once manufacturing is sent offshore, company engineers and scientists no longer engage with the process,

42 MARCH 2014 Manufacturers’ Monthly

Barry Thomas, a Brisbane-based manufacturer and exporter of medical devices with a strong R&D focus, has experienced first hand Australia’s talent for innovating the ideas and products of the future. nor are they on the ground when processes change. As a result, they are unable to improve designs accordingly. What Australia needs is a policy framework that retains our talent for innovation and advanced manufacturing on-shore and in

...an AIM Incentive is the logical next step to maintaining Australia’s competitiveness and cultivating innovation. doing so reaps the rewards of higher employment, lower welfare costs and increased investment from overseas. I believe that the implementation of an Australian Innovation & Manufacturing (AIM) Incentive is the logical next step to maintaining Australia’s competitiveness and

cultivating innovation. Targeted tax relief delivered through the AIM Incentive would not only help Australian manufacturers with a handup, rather than a hand out, it would also alleviate financial pressures on the Government by reducing the need for direct subsidies. The AIM Incentive would see the Government provide tax relief based on the retention of IP and manufacturing in Australia. It would require no upfront Government outlay. It is designed to stem the flow of manufacturing off-shore whilst providing future jobs for Australians and a competitive advantage for Australian manufacturers. The AIM Incentive is calculated on the qualifying IP profits generated from sources both inside and outside of Australia. Companies can pay a tax rate of 10% of their total qualifying IP profit derived from sources against the total amount of company tax payable for that particular financial year. The criteria for qualifying IP is extended to patents, copyright, registered designs, licenses and

“know-how”. Also included in the qualifying IP criteria would be companies that manufacture products offshore, provided that Australia will derive a significant net benefit from its sale overseas. Qualifying IP can either be developed in Australia or in-sourced from outside of Australia. Recently, Australian manufacturing has gained a lot of negative attention in light of the mentioned job losses and factory closures, as well as continued requests for corporate financial support to remain viable. However, the implementation of the AIM Incentive could transform this. The Federal Budget is fast approaching and there is an opportunity for the Government to consider this tax policy framework, which is a positive long term solution for Australian manufacturing and industry. Manufacturing has always been a consistent performer for Australian industry and it is imperative that it continues to be so. We have a collective responsibility to protect future industry jobs and opportunities for Australians for generations to come. Australia has such potential to innovate and manufacture and with the right policy framework in place, our full capabilities can be realised - an exciting prospect for all of us. [Barry Thomas is the Vice President and APAC Managing Director of Cook Medical Australia. Barry has more than two decades of international leadership and expertise in the pharmaceutical and medical device industries and he currently spearheads the world’s fastest growing region for Cook Medical. His current position sees him working to expand the opportunities for people in Asia to access Cook Medical’s advanced and minimally invasive medical devices.] Cook Medical Australia 07 3841 1188 www.cookmedical.com manmonthly.com.au

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Answers for Industry.

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