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February 2006

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From:
"Stadem, Richard D." <[log in to unmask]>
Reply To:
TechNet E-Mail Forum <[log in to unmask]>, Stadem, Richard D.
Date:
Wed, 22 Feb 2006 14:59:50 -0600
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I totally agree with what Phil is saying. However, we cannot blame the
vendors. The cost of maintaining inventory for discontinued machinery
along with the cost of continuing to support older models of equipment
is actually quite high.

One thing that more and more savvy EMS providers are doing is purchasing
used equipment for spare parts only.
Because of the recent downturn in the electronics business that we never
really recovered from, many CEM's (and many OEM's too, for that matter)
went out and purchased large quantities of capital equipment from those
companies that went under. They took a risk, in some cases a big risk,
and bought good used equipment for pennies on the dollar and warehoused
it all.
I know of at least two EMS providers that have maintenance and
engineering people working part of their time stripping down and
stocking pick and place equipment, wash pumps and motors, and many other
high-dollar-replacement-value parts. They are investing in the future,
keeping their personnel busy, and they are benefiting from this supply
of replacement parts, and they did not lose valuable highly-skilled
labor during slow times. For them, the gamble paid off and is continuing
to pay off. I personally took a semitrailer out and pick up millions of
dollars worth of equipment for a company I used to work for. They paid
less than $300,000 for good working equipment right off of the factory
floor, and we calculated that the real value of the machinery was close
to $18 million.
I think it is certainly a good business practice to always keep one eye
on the used equipment market, and purchase the good deals just for spare
parts, if nothing else. One must have a good tech or engineer who knows
the equipment intimately, in order to avoid buying worn equipment that
is beyond use or repair. But when business allows it, it usually is a
good ROI. 
A really good maintenance tech or engineer, who knows the machinery, and
also knows where to buy the individual components direct from the
vendors, is truly worth his/her weight in gold.


-----Original Message-----
From: TechNet [mailto:[log in to unmask]] On Behalf Of Phil Zarrow
Sent: Wednesday, February 22, 2006 1:49 PM
To: [log in to unmask]
Subject: Re: [TN] Dek Printer

 
Hi  all,
Steve  presented an interesting situation regarding the cost of the
replacement parts  for his printer.  Being a fellow  veteran "equipment
guy" he accurately points out that supporting and older  machine is a
bit more expensive.  I  looked in the situation with the front door
cover strut and, apparently, as a  result of time, inflation and, most
importantly, lower volume purchases (since  that part is no longer used
in current equipment), the price has gone up. 
 As one of my hobbies is keeping some  older sports cars alive and
running, I 
have run into this syndrome quite a bit  and empathize with both sides.

The Edge  Clamp Foil dilemma boggled my mind.  I had  to look into this
- inquiring minds want to know.  As it turns out,  one of my clients
recently undertook some upgrade work to their older DEK  printer.  I
inquired about the prices they encountered and the aforementioned clamps
were $217 (where, as Steve mentioned, they were previously $184).  Not
too bad.  However, a complete upgrade from the  original system to a the
quick change clamp system cost ( a year ago) $1284.  That's more like
it.  (Again, that was a year ago, though, and I suspect the conversion
costs even more now - again lower demand and volume purchased, not to
mention our fragile dollar). And at least they were in stock!  K
Jaworenko's experience with having to wait 32 weeks for  replacement
parts from an equipment supplier is deplorable. 
Maybe I'm too  altruistic, but I really don't think (and hope) that the
more reputable  equipment manufacturers have to resort to gouging on
spares to coerce us to buy  newer machines. Certainly, some seem to have
their acts together better  than others.  Of course our  experiences,
both in use and support with these manufacturers will influence our
next purchasing decision just as much as their specifications will and
they are  aware of that.  But, speaking as  someone who spent a lot of
time on the equipment side, supporting older machines  both in terms of
spares and retrofits is a tough part of the  business. 
One further  suggestion when contemplating a used piece of equipment and
calling the OEM's  field service department and chatting with a field
service 
tech.   Besides being the guys who actually work on the machines, most
field 
service  techs are opinionated and tell it like it is - good or bad.
(Sometimes they can be the "anit-salesman").  To use my automotive
analogy again, if you're considering buying a used automobile, who
better than a mechanic to tell you what's good and what to watch out
for?  Again, caveat emptor,  indeed. 
Phil  Zarrow
ITM  Consulting
Durham,  NH  USA
_www.ITMconsulting.org_ (http://www.ITMconsulting.org)  


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