Why investing in machinery can reduce costs in the textile industry?

Reducing costs in the textile industry can be the difference between achieving success and profitability with the company or creating bottlenecks that hinder its operation and business sustainability. Therefore, it is essential to find ways to manage production costs aiming for increased profitability.

In some cases, investing in machinery may be the best way to innovate in the company and reduce costs in the textile industry. Thus, with proper planning, significant changes can be identified.

This investment will have to take into account the long-term gains of your business, all with the help of technology, keeping pace with market trends.

To assist you with this issue, see today’s article for tips on how investing in machinery can help meet the challenge of reducing costs in the textile industry. Follow along.

Agility in production

Among the benefits of investing in machinery is agility in production and increased production capacity. Thus, by investing in new machines, it will be possible to increase the company’s profit, while also investing in the organization’s development.

In this case, it’s crucial to recognize the growth of the industry and its production capacity in order to understand the need for investments. In other cases, it’s possible to modify some machinery to continue performing the same tasks in a differentiated manner.

Thus, the more knowledge and updates regarding new technologies, the easier it will be to find the best type of machinery to assist in the growth of your company. With this, it will be possible to reduce costs in the textile industry and optimize its operation and productivity.

Related: How to reduce textile production time?

Cost reduction in the textile industry

It’s possible, through investment in machinery, to replace some practices that are becoming obsolete. In this way, it’s possible to reduce costs in the textile industry by focusing on increasing production and facilitating the productive agility of your company.

Furthermore, in some cases, it will be possible to increase product quality, reduce costs in the textile industry, and achieve a significant increase in production. However, this investment will only be possible with proper planning and in-depth knowledge of new technologies.

Related: Does production efficiency impact company profit margins?

Industry 4.0: from revolutions to preparation

It’s important to understand how Industry 4.0 emerged and to comprehend the changes that have occurred over time.

In this way, you’ll realize that it’s not the first time innovations have impacted the textile sector and how, in the past, each of the industrial revolutions contributed to the expansion and optimization of the segment.

Industry 4.0 is also called the 4th Industrial Revolution. Before it, three revolutions occurred:

• 1st Industrial Revolution (1784): development of the first weaving loom, introduced the manufacturing of water and steam-powered machinery.
• 2nd Industrial Revolution (1870): first mass production assembly line, utilizing electric power and based on division of labor.
• 3rd Industrial Revolution (1969): initiated with the first programmable logic controller (PLC), along with the development of electronics, and began the automation of processes.

The 4th Industrial Revolution is the one we are experiencing. It is based on computerized systems and the entry of autonomous robots into the production line. They communicate through technologies such as the Internet of Things (IoT), resulting in what are known as smart factories. The increase in data and the tools that have emerged to analyze this data have also led to the introduction of artificial intelligence.

What is the impact of Industry 4.0 on cost reduction in the textile industry?

In the textile sector, Industry 4.0 is making significant strides by integrating virtual and physical processes, as well as employees, software, and machinery. Investments are being made to replace equipment with more suitable ones, alongside programs and training to ensure that professionals are capable of performing their roles with strategy and competence.

The Brazilian textile industry ranks fourth globally, but still lags behind in global competitiveness in the industrial revolution. Many companies are still trying to restrain investments, often due to a lack of understanding of the gains they can provide.

Among the advantages are:

• There’s the ability to analyze the production process and identify bottlenecks to propose continuous improvements.
• High-performance automations not only standardize processes but also increase agility and reduce waste, with equipment such as the revising machine, relaxer, and sample washer.
• There’s the potential for customization of pieces and the ability to adapt to models like the fast fashion concept.
• Decentralization through a management system that connects processes and allows real-time communication and monitoring for production stakeholders.

Does Industry 4.0 really reduce costs in textile production?

With quality control, the production of second-rate pieces and errors that lead to fabric waste and time wastage are avoided. Furthermore, it’s possible to control input, categorize suppliers, scale production, and cut costs.

There’s also the potential to predict productivity and thus create a much more efficient and profitable planning. All these factors directly or indirectly contribute to cost reduction in manufacturing, leading to greater consumer satisfaction with access to higher quality products.

Industry 4.0 is not just a trend – it’s a reality that will become increasingly integrated into Brazilian companies. This is because, despite the need for investments in machinery, training, and other aspects, it can provide a higher profit margin, reduce errors, and increase competitiveness.

Starting to prepare your company for this major revolution by investing in modern machinery that helps optimize productivity is a cost-effective initiative and could be a significant advantage in gaining new customers and markets – both nationally and internationally.

The importance of Return on Investment

Return on Investment, known as ROI, is the indicator used in the business world, which provides an essential parameter for analyzing the return on any type of investment, from a technological research project and a marketing campaign, to the purchase of a new machine or even the acquisition of a new income title.

Thus, the ROI will show how much the company earned or lost in relation to what it invested. The results obtained through the calculation are used to evaluate, for example, how investments in marketing contribute to the company’s results and identify the financial return period for these initiatives.

Therefore, when making an investment in machinery, it will be possible to use the ROI to understand whether the investment is really profitable or not, enabling real knowledge of the reduction or not of costs and increased production.

How to perform and calculate ROI

To calculate the ROI, simply take the gain obtained, subtract it from the investment and divide the result by the initial investment. To help with this calculation, simply use the following formula:

ROI = (Gain obtained – value of initial investment)
Initial investment value

For example, if you make an investment of 3 thousand reais. In the long term, this investment generated a profit of R$15 thousand for the company. So 15,000 – 3000 / 3000 = 4.

In other words, your ROI value will be 4. This means that your gain from the investment was four times the amount invested. With this, you will be sure that you are really investing in the correct way, allowing you to reduce industry costs.

Therefore, it becomes interesting to think about investing in machinery as a way of continuing to make profits for the company, improving the quality and quantity of its production.

And you, do you want to know more about how technology can impact your business? Continue following our content and don’t forget to check out our equipment!

Originally published on: 04/20/2018 and updated on: 06/25/2020