Purchase of die & moulds in Low Cost Country (LCC) China

Buying die & moulds in China seemingly has high cost advantages due to toolmaker’s offer. But has high risks as well, which are often underestimated:

- Distance (travel times, transport routes),

- In China, for example, toolmakers work closely with Chinese parts suppliers or are parts suppliers themselves (risk: know-how transfer),

- Cultural differences, e.g. investment behavior in China:

1.   few trial runs, quick decisions (in consequences bad quality of parts)

2.   the most modern equipment (fresh financial support from banks, relatives or other investors)

3.   Too many acceptances of orders (too much projects running parallel)

- Little experience, for example, of Chinese toolmakers in high-volume production tools, e.g. incorrect hardness, dimensional deviations,

- Prices for high-quality tools are often just as high as in Germany (e.g. complexity, shot performance guarantee),

- Tools are often designed for manual assembly processes, higher requirements for automatic assembly lines required.

- The Chinese market in toolmaking and purchasing of parts is too complex and too dynamic to be treated and executed from Germany headquarters,

- Lack of trained personnel in toolmaking:

4.   milling strategies (target: time saving)

5.   manufacturing of complex 3D geometries

6.   milling and grinding in one clamping session, milling of highest surface qualities

7.   cost reduction in operations is not the main focus, e.g. no analysis of temperature critical areas leads to high cycle times

8.   technology of machines from the west is not exploited (only often prestige & status symbol)

9.   modern machinery says nothing about the efficiency of the tool shop or company

Buying die & moulds in China seemingly has high cost ad

- Distance (travel times, transport routes),

- In China, for example, toolmakers work closely with Chinese parts suppliers or are parts suppliers themselves (risk: know-how transfer),

- Cultural differences, e.g. investment behavior in China:

1.   few trial runs, quick decisions (in consequences bad quality of parts)

2.   the most modern equipment (fresh financial support from banks, relatives or other investors)

3.   Too many acceptances of orders (too much projects running parallel)

- Little experience, for example, of Chinese toolmakers in high-volume production tools, e.g. incorrect hardness, dimensional deviations,

- Prices for high-quality tools are often just as high as in Germany (e.g. complexity, shot performance guarantee),

- Tools are often designed for manual assembly processes, higher requirements for automatic assembly lines required.

- The Chinese market in toolmaking and purchasing of parts is too complex and too dynamic to be treated and executed from Germany headquarters,

- Lack of trained personnel in toolmaking:

4.   milling strategies (target: time saving)

5.   manufacturing of complex 3D geometries

6.   milling and grinding in one clamping session, milling of highest surface qualities

7.   cost reduction in operations is not the main focus, e.g. no analysis of temperature critical areas leads to high cycle times

8.   technology of machines from the west is not exploited (only often prestige & status symbol)

9.   modern machinery says nothing about the efficiency of the tool shop or company

10. shortage of skilled workers leads to automation (quality assurance instead of cost savings

)

11. high staff turnover, false certificates make incoming inspection necessary

12. transfer of “lesson learned” is often difficult, because the next design will be done by another person

13. most toolmakers are semi-skilled and have a simple school education

Furthermore, what is different, in a Chinese tool shop compared to a German one?

In production, there is often no multi-sided machining possible (manual re-clamping and setup is necessary). Skills by hand are rarely available (e.g. die spotting), often there is no jig- and profile-grinding machine available. In plastics processing, the tool is often not designed for an optimized injection moulding process of the part. If errors occur, there is no experience in the analysis of complex processes. The parts are visually optimized because there is often no understanding of the relationship between process and material properties.

From my point of view, following also has a negative impact:

-      Frequent changes of skilled personnel and managers

-      Severely restricted Communication in English

-      The deburring of parts is cheaper (60-90 Euro/month incl. accommodation, food) than the professional staff to improve the tools (200-400 Euro).

From the entrepreneur's point of view, however, the following working conditions are positive:

-      300 days/year working in tool shops, 3-shift operation is possible.

-      Modern machinery, good CAD/CAM equipment (high investment)

-      sometimes still low utilization of capacities (short delivery times)

Which experiences did you make?