Ozdemir_kocer_ms304

MS 304 / FALL 2007 / THE PROJECT MANUFACTURING AN INDUSTRIAL MACHINE: TELLING THE UNTOLD STORY VERSION 1.0 ALPHA

Hakan Özdemir (7643) Koray Koçer (8421)

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0. The Product 0.1. Which industrial machine do you plan to produce? Why?

Figure 1 Extrusion line machine Extrusion is a continuous shaping process of plastic material by forcing it, as a melt, by pressure through a die. Extrusion industrial machine is planned to produce with respect to some features. Extrusion machines which are used in industry have both simple rotating screws and screws which both rotate and reciprocate. The main reason why we have chosen the extrusion machine is that extrusion has a very large manufacturing process in many areas such as automotive industry, white goods, chemical industry, cosmetics, plastic industry, food industry, paper pulp processing and many others. There are some kinds of basic functions of the extruder; 

It leads to softening of the melt by heating process. This heating can be regarded from internal generated shear forces and external applied heat.

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In order to produce a homogeneous emlt without impurities, it mixes the melt.

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There is a need to force the material through the die. This pressure is applied by this process.

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Basic extruder types As said before, the extrusion is a widely used process which is applied in many industry with different types of extruders. Mainly, the extrusion machines can be seperated into 2 groups as single extruders and twin extruders. The summary graph can be given as below.

Figure 2 The groups of extrusion machine There are some specific definitions of the extrusion process. Extruder head; A part of the extrusion machine which can be linked or attached to the discharge end of the extruder barrel. This leads to housing of the die.

Figure 3 Extruder Head

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Barrel; A component which covers the screw in the extrusion line.

Figure 4 Barrel Die; The part is in the assembly line. It is forming the melt to get the desired profile.

Figure 5 Die Haul off; A device continuously takes away extrude from the dice

Figure 6 Haul off

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Screw; The component in the barrel of a screw extruder

Figure 7 Single Screw

Figure 8 Twin Screw Screw Diameter; It is about screw axis. Screw extruder; It controls the temperature in the system. It also conveys the plastics materials from the feed and delivers it to the die under the pressure.

Figure 9 Screw Extruder

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Extruder size; The inside diameter of the extruder barrel

Figure 10 Extruder Size Extrusion coating; A method of coating in which molten plastics is fed direct from an extruder die into a nip-roll assembly together with the substrate.

Figure 11 Extruder Coating

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Extrusion pressure; The pressure of the melt occurred at the end of the screw.

Figure 12 Extruder pressure 0.2. How is the machine used, and in producing which products / product families for which industries? To understand how the machine is used, the tasks applied to machine are listed below; Tasks 

Before the machine is functioned, a person should adjust some components of the system to regulate speed, pressure, system of the temperature, amount of material, raw materials and to control flowing of the material system.

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Make measurements of the materials which is participated in the process by using templates, micrometers or scalars.

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By monitoring operations, obtain the gauges to detect malfunctions.

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Press the buttons to function the machine and equipments.

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Turn on the controls about pressure, vacuum and cooling operations

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Prepare the molds, or dies with respect to operation type.

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Record the measurement scale of the readings, quantities, types and dimensions

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If the demands cannot be met, warn the supervisor.

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Control the speed of the operation

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By conveyor or hand, feed the raw materials into machine

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Clear jams and defective materials which can affect the process in a negative way

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Get the materials, supplies or finished products to put them storage with work aids like racks and hand trucks

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In order to prevent the product from sticking condition, clean the molds properly

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Put the tickets on the products

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Activate the machines to shape or form products like insulation panels or candy bars.

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After the process is finished, Remove the molds and tubes

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Send the proto type of the product to be analyzed

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By using the torches, activate the heat

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Again clean the dies, molds, chamber and compression by swabbing

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If there is defective equipment, replace nozzle, punches and filters.

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Installation and alignment of the press plungers and feeder tubes.

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By using gas lines, keep maintain plasticity of material.

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Control the solidification of the final products

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Check the tickets to verify the size of the products.

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Figure 13 One pro type of the machine As said before extrusion is very widely used manufacturing process used in many areas such as automotive industry, white goods, chemical industry, cosmetics, plastic industry, food industry, paper pulp processing and the others. For example, Glassware, food, rubber, soap, brick, tile, clay, wax, tobacco, or cosmetics are some areas. And also in Irrigation ,Sewer ,Mining Construction Drainage Gas & distribution, Irrigation, Sewer, Mining, Construction Drainage Rubber ose, Irrigation tubing, Medical tubing, Cable & wiring, Rods and Straws, extrusion is used.

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Figure 14 the usage area of the machine 0.3. Which companies, both local and global, produce this industrial machine and what is their position in the market? Evaluate each of your (significant) competitors according to the criteria below: The first company is XINDA Group. This company works for plastic machinery with extrusion technique. This company produces PET fibre master batches about 10,000 tons per year. The company claims that they are one of the biggest extruder producers in the world. And over 100 machines are sold every month. Place of Origin: China China Xinda is established in 1988 in China. Xinda is a famous group thanks to its quality products both in domestic areas and worldwide. There are 3 companies which are related each other. Price Terms: USD70, 000.00- 110,000FOB per machine (The machine below)

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Figure 15 One pro type machines Delivery Lead Time: 5 days in China- the export days between 1 and 2 month. Reliability: The company apply 3 guarantee policies for the maintenance services in the machines’ lifetime. This company is awarded with various associations like Grade and High Tech Company which is established by China government. The company expects the brighter future with the customers in domestic areas and abroad. Maintenance cost (regular and irregular costs and their lead time): For this cost, the average maintenance cost can be given with respect to machine sold. For one year, if one company earned 420000 Yuan (around 120,000.00 Euro) by selling of the extrusion machine, that company will meet around 860000 Yuan (around 25,000.00 Euro) maintenance cost. This is regular maintenance cost. However, sometimes, the machine can create a problem in any sudden time. At this point, the company has to meet its irregular cost per a month. For this cost, the company will pay around 20000 Yuan (around 5,000.00 Euro). The main difference between regular and irregular cost is time. For regular maintenance, it keeps stable time gap. Normally, the lead time for irregular maintenance cost is three times a week. For example, the some parts such as pistons, barrels, screws or extruder head of the machine are lubricated with some chemical solvents. The regular cost which is given above is for per year. However, irregular maintenance cost can occurs any time in the process. In other words, it is unexpected condition. The irregular cost which is given above is for per month. For irregular maintenance, the materials can be problem because of their structure. For example, if one part the material is not ductile enough, this leads to broken down some components such as screws, dies or barrels of the

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machine. There are also some other factors which lead to irregular maintenance. For instance, the pressure cannot be adjusted by the technician. The temperature cannot be increased or decreased with respect to operation required. Types of energy: Because of the structure of the machine, electrical energy for the functioning of the machine and natural gas for the heating are used. Past references: For Xında group, the feedback of our clients from some countries such as Indonesia, South Africa, Canada and India etc. are positive. They claimed that all the company works properly. And due to this, the company has very prospective reputation. Estimated life time: China Xinda is established in 1988 in China. The life time until time is very long. The company is also international company. It exports the products to North America, South America, Western Europe, Eastern Europe, Eastern Asia, Southeast Asia, Mid East, Africa, Oceania. According to its webpage, the total annual sales Volume of this company is between $10 and $ 50 million. These factors can help to estimate life time of the company in the future. It runs at least 15 years to the future. The company is Enka. This company is a leading manufacturing company in Turkey. The company mostly produces white and brown goods with plastic materials. The company considers the customer satisfaction as a development base. The company manufactures the products which are used by the many parts of the world like USA and UK. Price terms: The prices are changed around 150.000 YTL. Because of the export, the shipment cost is another factor which is taken in consideration as adding price.

Figure 16 The machine which is sold 150.000 YTL

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Delivery times: It depends on the region. The time for delivery is between 1 and 2 months by sea route and between 2 and 4 months by land route because of some problems about duty to the abroad.For the domestic markets, it takes almost one week. Reliability: The company is estabtablish in 1983 . There is not yet any awards from any associations. However, the company has so strong references from Vestel,SFA Cook, B/S/H,Vestfrost and Arçelik. The company tries to increase the reability of its products by focusing on the specific factors like saving time,labour and cost. Also, it conducts some project to get more success. The guarantee time for its products is 3 years. Maintenance cost (regular and irregular costs and their lead time): The machines are designed and operated by thinking of the required minimal energy for the maintenance. For this company, the maintenance cost is already as like as XINDA group. However, it is a bit more. For one year, the regular maintenance cost is around 27,000.00 Euro regular maintenance cost, when the company sells the products which are costed around 1500,000.00 Euro for per year. The irregular cost in this company is charged around 4,500.00 Euro. As said before, the causes of the irregular mainetenance is almost same with the XINDA group. The maintenance tecniques like lubricating, and component replacing are same. The important difference between XINDA group and Enka company is cost factor because of the establisment of different country. The China is not comletely capitalist country. There are still some workers who work under the unheathy conditions.

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Figure 17 the draft of the machine Types of energy: This company like XINDA used electrical energy, and natural gas energy. The cost of the production is a bit high. The electrical cost in Turkey is not like in China. Past References: The company is almost new. It is establishes in 1983. The company has been recovered itself and manufacturing product process with respect the feedbacks from the custormers. Estimated life time: Extrusion technik is established in 1983. The Enka Group is established in Turkey. The company expand in a wide working places in the world. The Group companies are Enka Marketing, Enka Power, Çimtaş, Kasktaş,Titaş, Enet, Pimaş, Atlas, Entaş, Moscow Krasny Holmy, Mosemka, and Ramenka. This company is also international company. The estimated life time of this company is at least 10 years to runin the future. This is lower than Xinda Group. This because of the development difference between China and Turkey. Today’s world, China can be given as more developed than the other companies.

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0.4. How does your machine work? Explain its mechanical working principles in detail. You can get help from your friends in the Mechatronics Engineering program. You can also refer to online patents at Spacemen (www.turkpatent.gov.tr) or Google (www.google.com/patents). Basic graph of the steps of the extrusion machine;

Figure 18 Simple line How the machine works can be explained by explaining functionality of the components in the system; 

The extruder drive is functioning with electrical power. It is geared with thrust bearing to create rotational movement of the extruder screw.

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The polymer feed the screw by hopper or gravity by metering screw or conveying spiral.

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The extruder barrel and screw include high concentration of strength steel. And the barrel and screw are protected from wear or corrosion. This is because those components can be hardened or coated treatments like nit riding or hard chroming.

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The barrel and screw can be placed between 3 and 7 zones. These sections can be heated and cooled with respect to material and process parameters.

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The die directs the polymer melt from the front of the screw. This is because it will form the basic shape of the product.

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Figure 19 Dies 

The calibration units keep stability of the form of the output. At this process, also, the polymer is cooled.

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The haul off lead dragging force to struggle with frictional forces in the calibrators. And, it pulls the process through the calibrators.

Figure 20 Haul off 

The saw or cutter cuts the profile until it catch the desired length.

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Figure 21 Saw blade systems 

After this process, additional manufacturing processes like rolling or casting can be performed with respect to operation.

0.5 Patent research and report: 1) This patent is taken from following web site; http://www.google.com.tr/patents?id=dvk6AAAAEBAJ&dq=Extrusion+machine

EXTRUSION MACHINE (by Arthus L. Phipps) This patent is a method which by extracting of one material, especially fragile materials like plastic foams, the material is removed from the chamber with atmospheric pressure. By doing this, the materials can be given off from the cavity space. This is done without any forces which are applied on that material. In other words, there is not extra force to apply this. At this method, the barometric leg is used for this process. However, this does not mean that this leg results in egress of the solid materials with reduced pressure. The leg is helping the worker to extract the material without facing any problems like cracking Figure 1 is the view of invention

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Figure 22 (1) The materials are moving from up to down by the pressure Figure 2, 3, 4, 7 is the embodied view of the extruder

Figure 23 (2, 3, 4 and 7) This is better view to see how the materials flow on the line Figure 4 is used for the Figure 1 and Figure 2.

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Figure 24 (4) Figure 5, 6 is a bit similar to Figure 1. And this is also used with Figure 7.

Figure 25 (5, 6) A combination comprising as follows: 1) The extruder for plastic material which expands in the form of rigid foam material when is released from extruder, a vacuum chamber, a barometric leg, and a pool of liquid. It means to lead the foam material from the chamber, barometric leg in to pool of liquid.

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The pressure is used to extract the material from the chamber. The extruder is connected to vacuum chamber. This leads to directing extradite in that vacuum chamber. The barometric leg has two ends such as the first end and the second end. The first end is connected to vacuum chamber. It lead the material to flow. The second end extends in to liquid in the pool. In order to stop pressure in outside, the liquid in the pool forms a seal from the barometric leg. In other words, it evacuates to vacuum chamber and barometric leg. At this point, the liquid in the pool is absorbed into leg with respect to pressure in the chamber. This leads to guiding the foam material to engage in foam material in liquid. After this, carrying of expanded foam material is materialized. In other words, the materials are given a shape. Lastly, it pushes the material down in the pool. This process occurs outside of the barometric leg 2) The barometric leg extends from the vacuum chamber to guide the foam material to comprise a belt conveyor. As can be seen, the barometric leg is used for the movement of the materials. 3) And lastly, that belt conveyor is placed in to the barometric leg. There must be some links between leg and conveyor to function each other. 2) This patent is taken from following web site; http://www.google.com.tr/patents?id=WyAxAAAAEBAJ&printsec=description&zoom=4&dq= Extrusion+machine#PPP3,M1

EXTRUSION MACHINE (by Arthus L. Phipps) This patent creates one machine that has optimum cross section of a hollow concrete body can be obtained. This means that the minimum amount of concrete can be used to have a body of the required strength. This extrusion machine makes elongated materials (article) of the concrete by forcing the concrete through a mold. That article has a large cavity. Therefore, by using optimum amount of concrete with respect to strength, the machine is moved forwardly with reaction when the concrete is controlled and when it is forced towards the molded concrete. One conveyor which is rotatable and spiral is placed in the mold in a longitudinal way. By doing this, it moves

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the concrete through the mold. When a no rotatable forming element is used, it leads to internal cavity with respect to the downstream end of the conveyor. With this internal cavity, there are some spaces in the material. These spaces lead to material to have lower strength and poor quality. There are three downstream of this system. The first one is that the element is formed with its lower edge. This lower edge is positioned to leads to having no more than %10 of the height. This is because less than %10 of the height is above the lower edge of the conveyor. The lower edge and the lower side are going to be free from any substantial ramp. At this point, second one comes out. The longitudinal center line is higher than the center line in conveyor. And the third one is that, at the end of the conveyor, the ramp is extending through the upward. In other words, it is extended from end of the conveyor. At that point, the conveyor forces the concrete on the elements which is in the forming process. This is to form the concrete article, as mentioned before. After this, there is a vibrator for resonance. This vibrator includes vibrator plane which is placed in the top of the mold. As said before, the ramp should be in short distance. It should not exceed %25 of its length. Otherwise, there can be energy lost because of the time passing. Lastly, the plurality of the elements can be mentioned. The first element is obtained with vibrator; however, subsequent elements are obtained without vibrate. In other words, vibrate is used for the just first element. It must be for the starting process. There are also dampers which compose links between elements.

Figure 26 (1) the general view of the machine

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Figure 27 (2) the view of the inside

Figure 28 (3) Twin screws

Figure 29 (4) the ram force

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3) http://www.google.com.tr/patents?id=eQ48AAAAEBAJ&dq=Extrusion+machine

Injection molding extrusion mixer (by William R. Meadors) This patent is about injection molding machine. This is molding process, but there are some points which are relevant to extrusion. Firstly, the charges of the suitable thermoplastics are warmed up. Later they are applied pressure hydraulically by pistons in the melt chamber. The piston makes pressure to the molten charge towards that chamber wall. These chamber walls are got orders in a line with Belleville spring washers. These washers are clumped to have a corresponding series of narrow and passages between those washers. After that, the molten metal is put on extrusion towards outside for the extrusion passages. This is because of having guarantee dispersion and warming all the charges. Without heating the charges, there can be some problems. For example, the some parts of the material will be thicker than the other parts without dispersion. The charges are flowing from the washers to the extrusion passages. This leads to disposing the washers in a correct way. In addition to charges, the mold cavity is also controlled. Mold cavity must be filled completely without vacancy or hole. At this injection machine, the Belleville washers are placed vertically into cylindrical chamber. Its position is made stable between upper shoulder, and lower valve assembly. The lower valve assembly includes also valve stem and links to valve head. At the operation, the pressure is applied valve stem and the valve head downwardly. This is because of assisting to go outwards of the molten charge. This process occurred between the washers. At this process the charges are flowing in mold cavity. After this, when the mold cavity is crowed fully, the inverse (back) pressure is applied on the valve head. The pressure which is applied on the valve head results in closing the mold cavity with the valve assembly which goes towards up. In other words, when the mold cavity is filled completely, the system can realize this fulfillment. And later, it terminated the process.

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The figures about the patent are given following way;

Figure 30 (1) the view of the machine

Figure 31 (2) the view of force part

Figure 32 (3 and 4): The view of rotating part

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Selecting the Manufacturing Type and Equipment 1.1. What type of production system is typically selected (ex: job shop, flow shop, etc) to produce the product? Extrusion can be carried out in hot or cold process. A chamber which is the portion of the barrel to being fired is involved in the process. Therefore, each billet is extruded individually. Because of all these applications, the batch flow is applied in extrusion machine.

Figure 33 the batch flow 1.2. What types of equipment are used for the production? You should consider not only the equipment directly used in manufacturing the product, but also indirectly used (ex: power generators) There are some functions of the equipment for extrusion process. These items lead to increasing of the effectiveness of the material and tools. These direct equipments can be listed and explained in a detailed way as below: Add on accessories (direct)  Water recirculation systems  product discharge and debris collection systems

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 safety guards and enclosures Product interfacing parts 

Clamps and rollers

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Cleats, belts and conveyor systems

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Air and water outlets

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Saw and cutter blades

Control and measuring (direct)  Digital and analog control panels  Vacuum and water gauges  Encoders As can be seen, almost all the equipments lead to some protection of the materials and tools to use them more. After the direct equipments, the next is the indirect equipments. Power system (indirect)  Motors and drives  Vacuum and water pumps  Hydraulics  Pneumatics 1.3. From which suppliers in Turkey and abroad can this equipment be supplied? Judge the suitability of each candidate supplier based on The first one is that Shanghai Electric Group Printing and Packaging Machinery Co., Ltd. The Company is established in 1999 in China. It is a manufacture Equipment Company for the extrusion machine. The company claimed that the total annual sales

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volume of the company reaches above $100 million. The company is awarded with ISO 9000/9001/9004/19011: 2000 as a certification. The products of this company can be exported and imported. It other words, it is international company. Some countries are North America, South America, Eastern Europe, Southeast Asia, Africa, Oceania, Middle East, Eastern Asia, and Western Europe. Price:  Water recirculation systems $1,564.00  product discharge and debris collection systems $171.61  safety guards and enclosures -White (1960mm) £22.95 - Color (1960)mm £24.95  Clamps and rollers  $44.99 and $1.04 per roller  Saw and cutting blades19.99 per each blade 

Cleats, belts and conveyor systems$1.59- $11.40 and $21.05

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Air and water outlets$26.95

 Digital and analog control panels $10,328  Vacuum and water gauges $26.95 and $21.99  Encoders $168.00  Motors and drives $379.00  Vacuum and water pumps $17,000.00 and $34,500.00  Hydraulics $8900.00  Pneumatics $399.00

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Lead time for delivery: The China has very large land like USA. For the domestic markets, it takes almost one week. For export, the time for delivery is between 1 and 2 months by sea route and between 2 and 4 months by land route because of some problems about duty to the abroad. Reliability: The product life time is 3 years. It has a guarantee document. The company is awarded with ISO document. The company meets all the services with respect to the scope of guarantee document. They try to be expert for their extruders to satisfy the customers’ needs. Maintenance cost (regular and irregular costs and their lead time): The equipment life, replacement and damages can result in the needs of the maintenance. At this part, the maintenance depends on the system. To illustrate, the production of the extrusion machine needs the controls with computer system and the digital analog control panels. However, the computer has low capacity like CPU or RAM. The computer can be hacked by someone. At this point, the cost of the irregular maintenance is between $150 and $200. If the computer system is functioning with any machine, this cost goes higher; between $400 and $500. The regular cost for the computer system is the updates. The company can buy some software programs. For the digital analog control panels, the same reasons like software programs can be said. The cost like this is around $1000 per year for membership. Apart from the computer system, the water recirculation and digital and analog control panels can need to be put in the maintenance with replacement or damages. The price information is taken from the webpage: http://www.shop.com/. This is not about fresh good. The company web site does not include the cost of fresh goods like water circulation system or power system. The Guesstimate techniques are used to have the cost numbers. For the water circulation, the water can cut off and the machine cannot be produced. This is included in irregular cost. For this reasons, the cost value can be anticipated with its price. If the price is around $ 120,000.00, the cost can be $75,000.00 per unit production. The machines have saw blades to shape some metals. These components can wear out gradually, as time passes; therefore, the parts must be changed. The price of the $21.99 per each saw blade. The saw blades can be broken down. At this respect, the additional cost is technician cost. It is around $12. After the direct equipment costs, the indirect equipment cost comes out. This cost includes the power systems like Vacuum and water pumps, Hydraulics and Motors. These are electrical devices. If the machine is broken down, the high cost will be met by

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the company. For example, the new Hydraulics system can be bought around $8,900.00. The new vacuum and water pumps can be bought around $17,000.00 and $34,500.00 sequentially. When the equipments are replaced, the company should regard these costs. There can be irregular costs in any time. For this cost, the technician is given between 300 YTL and 550 YTL with respect to the system Past References: The lifetime of the company is so long. The company dedicates itself to the customer needs. It claimed that every customer has different needs and wants. The company works and manufactures a wide variety of products with respect to the customer types. Estimated life time: The Company is established in 1999. It is almost fresh company. However, the company can reach many countries. Therefore, it is international company. The establishment year and the large export opportunities make the estimated life time difficult. For this company, it can be considered as improving and expanding, the estimated life time is between 12 and 15 years. The second one is that Zhangjiagang Beier Machinery Co Ltd. The company is established in 1989. It is a supplier of plastic machinery. It is claimed that the company exports $9 million goods each year around the world. Some regions are Europe, North America and Asia. Country origin is in China. Price:  product discharge and debris collection systems $163.63  Water recirculation systems $1,364.00  safety guards and enclosures -White (1960mm) £23.95 - Color (1960)mm £25.95  Clamps and rollers  $442.99 and $1.08 per roller 

Cleats, belts and conveyor systems $1.75- $11.68 and $19.87

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Air and water outlets $24.95

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 Digital and analog control panels $19,498  Vacuum and water gauges $27.95 and $23.89  Encoders $159.00  Motors and drives $378.00  Vacuum and water pumps $1690.00 and $3350.00  Hydraulics $8100.00.  Pneumatics $389.00 Lead Time for delivery, between 35 days and 45 days Reliability: The Company is certificated with ISO 9001:2000 in China’s Jiangsu province. The issue date of the award is 25.08.2005 and the expiry date of the award is 25.08.2008. This award is issued. This gives a proof that the company is functioning in a proper way. Maintenance cost (regular and irregular costs and their lead time): The problems about the equipment are almost same with Shanghai Electric Group Printing and Packaging Machinery Co., Ltd. for the previous part. The cost can change a little. The computer is loaded virus. The irregular cost of the repairmen is around between 100 and 150 YTL. If the system is functioning with the any machine, the cost comes out between 350YTL and 400 YTL. And the computer needs to update some problems. The regular costs for these updates around 1000 YTL per year for membership. The other system costs can be given as follows:  The water circulation system: Cutting of the water around $65000  The saw blades$19.99 per each saw blade Additional technician cost when the blades are broken is between $10- $15 For the indirect costs, the power systems can be given example again. This is again very high. The system of water pumps can be bought around $36,500.00 and the system of vacuum pumps

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can be bought around $15,000.00. If any parts need to be replaced with the new one, this is again additional technician cost is around 400 YTL. Past References: The Company is awarded with ISO 9001:2000. This kind of award is given to the institutions with respect to customer feedbacks. It is one of the important institutions. The institution focuses on the quality and proper work style in the world. However, in the past, there are some complaints about defective goods. The company changed the defective parts with the new ones. The company claimed that if there are some problems with its products, the company can get back the machine for a certain time. Estimated life time: The lifetime of the supplier is 47 years (from 1962 to 2007). The company exports $9 million goods in one year. The export countries are Middle East, Russia, East, South Asia and Europe, Eastern Europe, North America, Mid East/Africa, Central/South America, Asia, Western Europe, and Australasia. The company is international company. The estimated life time of this company is at least 12 years. Raw Materials Used; 2.1. What raw materials and/or subcomponents are used in manufacturing the product? You can refer to patents online (www.google.com/patents) to learn about the raw materials / subcomponents used in manufacturing your industrial machine. Draw the complete Bill of Material (BOM) for the product, identifying each node in the BOM with a label and explaining each label later on in plain English. Draw your BOM using yEd Graph Editor, a free software written in Java, that can be downloaded from the web site of www.yworks.com. Once you draw your graph, select the appropriate layout technique to show your graph aesthetically. With respect to the performance requirements and economic conditions, the material selection should be done. In addition to performance and economic conditions, the life of one machine is also obtained with good quality and dimensional materials. For many machines, thermoplastic polymers are used in the process.

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Typical Materials for the Plastic 

HDPE (High Density Polyethylene)

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LDPE(Low Density Polyethylene)

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LLDPE(Linear Density Polyethylene)

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PETG

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Flexible PVC

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Butyrate

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Polypropylene

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Polyatyrene

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ABS

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Some metallic materils like Low carbon steel, Steel alloys, and Stainless steel

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Brass

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Aluminum

The most prefereable used material for extrusion is PVC. This material is used so widely. This is because of low cost, chemical resistance and its availability with a wide range variety of colors and hardness. Although the PVC has multiple functions, there can be some problems for critical application like unsudden rise in temperature

Figure 34 Schematic of Extruder

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The Figure 34 is taken as a base of the BOM graph. The two major parts are composed; Flow Line Part with Die, Barrel, Screw, and Cooling System, and Power Part with Powder Seal, Thrust Bearing, Motor and Reducer. Dies have been made with Saw and Cutter which are manufactured with High steel alloys, and shafts by pressure. Barrel are supported with Gears, Shafts, LDPE, ABS and Low Carbon steel as a Barrel support. And, also, it is insulated with HDPE and Low Carbon steel because of the sudden changes in temperature. Lastly, the barrel is equipped with Gears. Screw are made with strong steel alloys because of high strentgh. Cooling system is composed with flexible PVC, Water Cooled system and PETG. The water is used to reduce the temperature on the material surface. Apart from the Flow line, the power part is composed with Reducer, Motor, Powder Seal and Thrust Bearing. Motor has Belt and Sheave to turn on the gears and broachers. The Throat and Hopper are combined on Powder Seal. These two tools composed the Shaft. After the composing of Power part and Flow line part, these two part is covered with base to keep safety from the enviromental causes like dust. Lastly, the machine is composed with all the tools which is mentioned above. 2.2. What are the material characteristics of the raw materials and/or subcomponents, and why are they required to exhibit these characteristics? 

HDPE (High Density Polyethylene); HDPE has very high density of PE plastic. It is stronger than LPDE. This raw material gives stronger structure and tensile strength. This material is so hard and opaque. Therefore, it can withstand to higher temperature conditions. HDPE is ligther than water. In the welding process, it can be machined and moulded.HDPE can be used for many applications like Tupperware, Laundry detergant, milk jugs, fuel tanks and the others. This is because the HDPE can resist to many solvents. HDPE is used for firetubes. This material makes the firetubes safer. Although there is a dang)erous condition, the tube will not be shatter.

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Figure 35 HDPE 

LDPE(Low Density Polyethylene); This material is made from oil. It is very economical for many application. When LDPE is compared with HDPE, the features are less than HDPE. It is cheap, good chemical resistance, and good electrical properties. It can be weldable and machinable. Its tensile strength is low, however the resilience is high. Because of tight molecules, its density is low. This material is also used for bottles,tubing, plastic bags, some computer components, containers and laboratory equipment. The products which include LPDE has corrosion resistant work surface.

Figure 36 LDPE 

LLDPE(Linear Density Polyethylene); This material is produced with metal catalysts. The tensile strenght is high. It shows higher resistance, especially Ultraviolet, than LDPE. It is very flexible, and it can elongate under the stress. Great flexiblity leads to having

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conformance to differential settlement. It has good electrical properties. This material has high mechinical property with low density.

Figure 37 LLDPE 

PETG: This material is transparency. It orher words, the light can be seen at the back point. The other features of this product is high gloss, toughness, high impact strength, good clarity, fast forming cycles and ease of forming. PETG can be sterilized with gamma rays and resist to stress whitening. This material can be formed easily, cut and punched.

Figure 38 PETG

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

Flexible PVC;( ½ ‘’ ID li olan 0.66 cent): This material provide high performance and low cost requirements for successful extrusion process. It is opaque, lightly filled, clear and super flexible.

Figure 39 Flexible PVC 

Butyrate; Bulyrate is a short chain fatty acid. The fatty acid gives energy to the colon. Its cost is between $14 and $20. The inherent odor of Butyrate can be reduced by perfuming it. This material show mechanical, electrical and colorful properties. For mechanical property, it is specified with plasticizer. For electrical propery, it has a high dielectiric, good dielectric strentgh and volume resistivity, and a high dissipation factor. For colorful property, Butyrate can be obtained in natural, clear, selected amber(smoke transparents), and black translucent.

Figure 40 Butyrate

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

Polypropylene; Polypropylene has low cost polymer with a wide variety of uses. According to website (http://www.dynalabcorp.com), Polypropylene (PP), a polymer prepared catalytically from propylene which differs from HDPE by having an isostatic replacement of a hydrogen atom by a methyl group on alternate carbon atoms in the main chain. Although largely unreactive chemically the presence of the methyl groups makes Polypropylene slightly more susceptible to attack by strong oxidizing agents than HDPE (2007). The important advantage of this material is that it can outstand higher temperature resistance. For example, this material is used for chemical tanks; laboratory cabinetry and semi conduct bench tops.

Figure 41 Polypropylene 

ABS; The plastic material is very strong, durable, and pretty inert. By molding at the high temperature, the final product is contributed to the gloss and heat resistance. In addition to this, it leads to having highest impact resistance and strenth with low temperature. As a result, this material can be used in the high and low temperature. According to the website (en.wikipedia.org), the ABS will be degraded (dissolve) when exposed to acetone. This is already how you clear the etch resist off your pcb (2006).

Figure 42 ABS

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2.3. From which suppliers in Turkey and abroad can these materials and/or subcomponents be supplied? Judge the suitability of each candidate supplier based on The first supplier is Plastic Services Centers. The company is established in USA. 2.3.1. Prices of its products, depending on the order size The product prices can be given as follows: 

HDPE (High Density Polyethylene) $29.56 for Bottle HDPE Wm 32 OZ 6/PK



LDPE(Low Density Polyethylene) $29.19 for Bottle LDPE Wm 32 OZ 6/PK



LLDPE(Linear Density Polyethylene) $25.14. Its size 43 x 48. High Density. 56 Gal



PETG $64.16 for one piece. Its wide is 0.100.Its size is 48x72



Flexible PVC $0.55 per foot



Butyrate $42.99 for 45 gm Tube



Polypropylene $109.95 for one plastic pag (225 pieces)



ABS $11.99 for one piece

2.3.2. Mean and variance of lead time for delivery of a given order, depending on the order size (ex: “delivery for batches of 2000 units is completed in 3.25 days on the average, with 0.85 days of variance”). You should specify the distribution as well, such as N(3.25, 0.85) if the lead time for a particular order size is following a normal distribution. HDPE- 200 Bottles of HDPE-3.25- 0.85- N (3.25, 0.85) 300 Bottles

-3.50-0.82- N (3.50, 0.82)

LPDE- 200 Bottles of LDPE-3.25-0.85- N (3.25, 0.85) 300 Bottles

-3.50-0.82- N (3.50, 0.82)

LLDPE- 300 pieces (43 x 48. high density. 56 Gal)-3.50-0.73- N (3.50, 0.73) 500 pieces

-4.25-0.65- N (4.25, 0.65)

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PETG- 400 pieces (48x72)-3.75-0.68- N (3.75, 0.68) 600 pieces

-4.50-0.60- N (4.50, 0.60)

Flexible PVC- 2000 foots-3.80-0.65- N (3.80, 0.65) 3000 foots-3.90-0.60- N (3.90, 0.60) Butyrate- 250 tubes-3.45-0.78- N (3.45, 0.78) 350 tubes-3.75-0.70- N (3.75, 0.70) Polypropylene- 100 plastic bag- 2.75-0.92- N (2.75, 0.92) 200 plastic bag-3.00-0.87- N (3.00, 0.87) ABS- 250 pieces-3.45-0.78- N (3.45, 0.78) 300 pieces-3.75-0.70- N (3.75, 0.70) The Guesstimate techniques are used for the mean and variance. 2.3.3. Transportation and storage requirements for the products (do the products have to be kept in air-tight containers, cold storage, etc.) The company reached CC agreements with various transportation companies like railcar. The company can just export Canada and Mexico. There is no oversea export to the other continents. By railcar, the products must be put in to containers. The materials can be combustible. Therefore, it is dangerous to come close with fire. In addition to this, the materials should be packed with polyester bag. The freshness of the material can keep more. For the temperature, the raw material can stand at the room temperature. If the transportation occurs in the winter or summer, there can be need to special enduring containers.

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2.3.4. Past References of the supplier (companies that have used the supplier’s products and can express their satisfaction with the products of the supplier and the service quality provided by the supplier) The company is awarded with ISO 9002:2001 institutions. The company has also many reliable suppliers like WP, Comtrex, Basell, GT, Cereplast, A. Schulman and Uniform Color Company. These sponsors are also good indicator of the company reputation. The company gives a certification with some specifications as a guarantee document . However the customers are curious about the material structure and strength of the materials. For example, according to FAQ in the web page (http://www.plasticservice.com), ‘’Does PSC offer filled and reinforced products?’’ is asked by one of the customer. And the company replies that they present mineral, talc, PTFE, calcium and glass.

Figure 43 Die parts

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2.3.5. Estimated life time of the supplier (for how long has the supplier been active in industry and for how long will it be out there?) Plastic Services Centers is established in 1904. The company has a very large agencies over the USA. The company is not international. Actually, it is internaltional, but not oversea. This means that the company does not supply the equipment to the other continents like Africa, Europe, Far East and Turkey. On the Bom graph, the modification with amounts, mean, and variance is shown as follows because of the limited space on the graph. HDPE- 200 Bottles N (3.25, 0.85) - 300 Bottles-3.50-0.82- N (3.50, 0.82) LPDE- 200 Bottles of LDPE-N (3.25, 0.85)- 300 Bottles -3.50-0.82- N (3.50, 0.82) LLDPE- 300 pieces- N (3.50, 0.73)- 500 pieces - N (4.25, 0.65) PETG- 400 pieces N (3.75, 0.68)- 600 pieces- N (4.50, 0.60) Flexible PVC- 2000 foots- N (3.80, 0.65)- 3000 foots- N (3.90, 0.60) Butyrate- 250 tubes-N (3.45, 0.78)- 350 tubes-N (3.75, 0.70) Polypropylene- 100 plastic bag- N (2.75, 0.92)- 200 plastic bag-N (3.00, 0.87) ABS- 250 pieces-N (3.45, 0.78)- 300 pieces-N (3.75, 0.70)

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Figure 44 BOM graph

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3. Manufacturing Facility and Processes

Figure 45 the extrusion machine MAIN FEATURES OF PRODUCTION LINE: In the extrusion process, in order to ensure high and stable output, high efficiency screw designed materials. There is a strong abrasion resistance in caterpillar and also stable and high speed pulling force. Lattice basket die can function under low melting pressure. It also has large process range. In the dust free automatic cutting process, the cutting section is flat and smooth with high precision and low noise. 3.1. How does the production actually take place? Draw a complete UML activity diagram with swim lanes. Make sure to indicate which raw materials are used at each activity. Also make sure to show the manufacturing processes of each type of manufacturing equipment, using swim lanes in your UML activity diagram.

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Raw Materials

Low Carbon Steel

Steel alloys

Brass

Stainless stell

Flexible PVC

Aluminum

Heat Treatment

Tension

Creep

Residual Stress

Fatigue

Compression

wrought materials

Autocad

3D design

Rolling

Casting Forging

Cooling system

Machining LDPE

HDPE

ABS LLDPE

Combination of the parts

Polyatyrene PETG

Polypropylene

Butyrate

Adding equipment machines

Painting

The product

Testing

Furnace Polishing

quality control

Figure 46 UML Diagram

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Packing

Putting label

3.2. What type of a layout (process based or product based?) should the manufacturing facility have? Find sample layouts from literature and Internet (related with manufacturing the product), explain these layouts, and discuss the advantages and disadvantages of each layout with respect to the demand conditions. For the first time, all the components in the line are so basic functions. As time passes, the developments are obtained. The main development is output rates. The advances are reached with respect to demands of processors. In addition to this, the improved control system leads to having low cost and high technological computer system. The output rates are checked easily with that computer system. Today, the computer system is indispensable component of the manufacturing system. It is the most powerful and faster solver for the manufacturing plan. However, with respect to disadvantage, the capacity of the computer can sometimes be insufficient. In other words, that problem makes the system difficult to plan. The capacity of order cannot be met by the company. The all four systems have the same process for the first three steps. 

Batch Mixer



Continuous Moisturizer



Extruder

After this point, the layouts have differences in the process. Below the each layouts, some advantages and disadvantages are given specifically. Four different layout techniques can be given as follows:

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CERENALS SWEET SNACKS

Figure 47 Cerenals Sweet Snacks A: BATCH MIXER

E: PRODUCT TRANSFER

B: CONTINUOUS MOISTURISER

F: COOLING DRUM

C: EXTRUDER

G: COATING MASS PREPARATION

D: COMBINATION DRIER/COATHER This layout includes 7 different steps. This is used for the cereals. The raw material is put in the batch mixer. By shaking, they are flown into moisturize to prepare it for the process. The cereals are extruded by passing some heating and cooling processes. Lastly, the products are ready at the G section. The temperature can create a problem. This is because almost all the process includes the heating, cooling and moisturizing. If any problem occurs regarding temperature, all the process comes to nothing. Because of the humidity, the dust can get dirty in the system.

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SNACKS

Figure 48 Snacks A: BATCH MIXER

D: COMBINATION DRIER/COATHER

B: CONTINUOUS MOISTURISER

G: COATING MASS PREPARATION

C: EXTRUDER This layout is more basic than the Cerenals one. The system includes 5 steps. As can be seen above, this system does not include any heating, cooling or moisturizing parts. There are some products which do not need to have those parts. With this respect, some problems like dust, and temperature can be ignored for this layout. Like all the layouts, the system must be established well. These lines are controlled with computer system. Therefore, all the layouts can create problems regarding design by computer. COEXTRUSION

Figure 49 Coextrusion

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A: BATCH MIXER

H: COEXTRUSION

B: CONTINUOUS MOISTURISER

F: COOLING DRUM

C: EXTRUDER This system includes 5 parts. The more extrusion process is consolidated. Here, the more strength materials which are needed more effort to be shaped are attributed to operations. This layout includes cooling system at the last step. Therefore, the temperature problem can again occur for this line process. FLAT BREAD

Figure 50 Flat Bread A: BATCH MIXER

J: INFRARED OVEN

B: CONTINUOUS MOISTURISER

K: COOLING BELT

C: EXTRUDER

L: CUTTING MACHINE

I: PULLING & CALIBRATING BELT

M: STACKING UNIT

The most complex layout is Flat Bread. The system includes 8 parts. This system has also special oven for heating, cutting machine to cut hard materials, stacking part and calibrating part to adjust the belt. The belt is plastic. It can break away by forcing more. Because of the heating and cooling steps, there can be a problem about temperature. At the last step, Stacking process must be organized well with the area-volume places and workers. The products can accumulate in mass.

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3.3. What other products are typically produced together with this product in the same production facility? The line is a single. There is no any other products which are produced with our machine. The machine is very complicated. There can be some wastes. These wastes which are composed with very strength materials are used for petrol products like asphalt. 3.4. What are typical fixed costs for establishing the production facility? The company can occupy around 40,000 sq. ft. or 50,000 sq. ft. in modern industrial area. The facilities can be engineering, fabrication, transportation, machining assembly, packing and electrical assembly. The ages of the employees can be between 18 and 30. The wages are distributed to the workers. These wage amounts can be as below. All the machines can be controlled with computer system robotically. Workers in the extrusion line have a variety range of jobs. Therefore, many people can be employed. Machine operations need to high skilled and experienced labor and engineers. Also, sometimes, there can be temporary employees for the sudden demands. These temporary workers are got paid more than normal worker. According to U.S. Department of Labor report, the average hourly earnings of the workers in May 2006 can be given as follows: 

Model makers, metal and plastic

$20.22



Patternmakers, metal and plastic

$17.01



Layout workers, metal and



Metal refining furnace operators and tenders



Lathe and turning machine tool setters, operators, and tenders, metal and plastic



Milling and planning machine setters, operators and tenders, metal and plastic



Rolling machine setters, operators, and tenders, metal and plastic



Heat treating equipment setters, operators, and tenders, metal and plastic

$16.15

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$15.69 $15.46 $15.18

$14.93 $14.83



Tool grinders, filers, and sharpeners



Multiple machine tool setters, operators, and tenders, metal and plastic



Drilling and boring machine tool setters, operators, and tenders, metal and plastic $14.36



Pourers and casters, metal



Forging machine tool setters, operators, and tenders, metal and plastic



Foundry mold and core makers



Extruding and drawing machine tool setters, operators, and tenders, metal and plastic

$14.73 $14.68

$14.22 $13.94

$13.82

$13.58 

Grinding, lapping, polishing, and buffing machine tool setters, operators, and tenders, metal and plastic

$13.50



Plating and coating machine tool setters, operators, and tenders, metal and plastic $13.21



Cutting, punching, and press machine tool setters, operators, and tenders, metal and plastic



Molding, core making, and casting machine tool setters, operators, and tenders, metal and plastic



$12.66

$12.29

Metal workers and plastic workers, all other

$16.69

3.5. What are typical unit production costs? If the items price values are summed, it is around; Water recirculation systems $1,564.00 (1 item) Product discharge and debris collection systems $171.61(1 item) Safety guards and enclosures -White (1960mm) £22.95 - Color (1960) mm £24.95 (for each 1 item)

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Clamps and rollers  $44.99 and $1.04 per roller (1 item) and (20 pieces) Saw and cutting blades19.99 per each blade (1 item) Cleats, belts and conveyor systems$1.59- $11.40 and $21.05 (1 item for each) Air and water outlets$26.95 (1 item) Digital and analog control panels $10,328 (1 item) Vacuum and water gauges $26.95 and $21.99 (1 item) Encoders $168.00 (1 item) Motors and drives $379.00 (1 item) Vacuum and water pumps $17,000.00 and $34,500.00 (1 item for each) Hydraulics $8900.00 (1 item) Pneumatics $399.00 (1 item) HDPE (High Density Polyethylene) $29.56 for Bottle HDPE Wm 32 OZ 6/PK (1 piece) LDPE(Low Density Polyethylene) $29.19 for Bottle LDPE Wm 32 OZ 6/PK (1 piece) LLDPE(Linear Density Polyethylene) $25.14. Its size 43 x 48. High Density. 56 Gal (1 piece) PETG $64.16 for one piece. Its wide is 0.100.Its size is 48x72 (1 piece) Flexible PVC $0.55 per foot (20 piece) Butyrate $42.99 for 45 gm Tube (1 piece) Polypropylene $109.95 for one plastic pag (225 pieces) ABS $11.99 for one piece (1 piece)

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All the production cost one unit goes around $ 64,000. It is tried to choose for just one process. 3.6. What are typical setup (fixed) costs for an order, depending on the order size? The typical setup fixed costs for an order is around 100.00 Euro. It also depends on the size and types like single extrusion or twin extrusion). The twin one is more complex because of including more components. For the size, there is not so importance difference. For example, normally it is said around 100.00 Euro. If the one bigger size is taken consider, the additional cost is between $15- $20. 3.7. Can you find any remarks in the literature or on the Internet on the “break-even point” when producing the product (and similar products together with it) The breakeven point is an indicator of the going profit. While the company is establishing one company with its facilities, high amount money is spent to catch the best. The company begins to cover its costs after a while. At this point, the company passes the breakeven point. This means that the company begins to get profit. The figure of this point is given below. This is very special and secret information for the company.

Figure 51 Breakeven Point

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4. Manufacturing Decisions under Various Scenarios Consider different levels for the following factors: A1. Production volume characteristics (mean and variance of production quantity, range of volume produced) The production volume characteristics can be obtained from company which is called XinRong Science & Technology Co. Ltd. At this company, it is claimed that screw make optimization composing screw and mixing parts separetely. And also, barrel make optimization of composing groove barrel and feeding segment which is lengthened. There are some data from that company that can be obtained mean and variance of production quantity. There are five models of this extrusion machine. The numbers are maximum output. For this number, the screw diameter, motor power and screw speed can be given importance. By changing these three parameters, the number of maximum output can be changed. 1)SJG45X33

150

150+250+350+500+800=2050

2)SJG60X33

250

MEAN: 2050/5 = 410

3)SJG75X33

350

VARIANCE: 20.2 (The square root of the mean)

4)SJG90X33

500

5)SJG120X33

800

Figure 52 single screw extruder

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A2. Demand characteristics (such as mean, variability) for the company’s products The company view of the demand characteristics can cover the other companies’ missions. For the extrusion machine, there are some good examples can be given as examples like Characteristics * High Impact Resistance * Excellent Light Transmission * Excellent Weather Resistance * Heat Distortion Resistance * Flame Retardant These are all about the strength and well qualified products. The customers want to use their products as long as possible. A3. Demand characteristics (such as mean, variability) for the products in the market offered by all the players in the industry Some industries considers some demand characteristics such as utility, value, wealth, consumption, wants, necessaries, comforts and luxuries. These items can be seen as a law of the demand or elasticity of demand. The companies focused on the customers’ satisfaction. Therefore, they modify themselves with respect to customers’ feedbacks about their products. A4. Manufacturing facility characteristics A4.1. location with respect to major demand locations such as big cities (especially for consumer products) or organized industrial regions (especially for industrial products) The company should be established with respect to having lower costs like shipment of the products, and raw materials. The product can be sold with same price in any place. However, the company should consider its cost. The company can be established in industrial park area in one of the big cities such as Istanbul, Izmir, Bursa, Antalya or Izmit. In fact, this area can be close to the sea due to easy shipment. A4.2. area in m2

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The area of the company can be between 2500 sq. ft. and 3500 sq. ft. This can be considered as the placement of the machines, the storage capacity, technician rooms, engineering rooms and other facilities like cafeteria, restroom, and changing rooms for the workers. A4.3. volume in m3 The volume of the company can be between 45000 cubic meters and 50000 cubic meters. If the higher volume is considered, this leads to some problems like slow heating. If the slow heating occurs, this will affect the machine to work improperly. A5. Various product characteristics Characteristics: The charging barrel heating and cooling is functioning with air cooling system and ceramic belt type heater. This is because of controlling the temperature precisely. It prevents the temperature from sudden increases and decreases. However, there is only middle air flow which can cool cupper heat radiation sheets. These sheets are designed in a special way. In addition to cooling cupper heat radiation sheets, it also produces high conductivity. This is because of decreasing the loss of the energy. Its noise is very low. There is no need to supply earphone to the workers to keep their ears in healthy. It can absolutely make sure about melt temperature. Single screw extrusion machine; 1. Screw die: 70 MM. 2. L/D ratio: 24:1. 3. Screw material: SACM-1 all oyed steel. 4. Barrel material: SACM-1 all oyed steel. 5. Heating type: heater. 6. Cooling type: air cooling. 7. Heating zone: 6 zones.

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8. Heater capacity: 15 KW. 9. Screw R.P.M.: 10 ~ 50 RPM. 10. Main driving motor: AC 20 HP. 11. Center height: 1060 MM. 12. Output: 50 ~ 90 Kg/Hr. 13. Power consumption: 35 KW. 14. Machine dimension: 2.1M (L) x 0.8M (W) x 1.5M (H). Twin screw extrusion machine; Twin screw extrusion machines have the almost same features of the single screw extruder. However, there are some properties which show differences. The twin one can do self cleaning and wiping. These machines show precise works. And they can be used for simple compounding to continuous chemical reactor.

Figure 53 Single screw extrusion machine

Figure 54 Twin screw extrusion machine

A6. Geographical and climatic conditions; the company will employ highly well skilled and qualified engineers and workers. These people will work and operate all kinds of machines and equipment in all geographic areas and climatic conditions. In the company, the specialists who are equipped with most advanced instrumentation will apply quality control tests. These tests

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lead to performing non destructive control of quality of welded joints and insulation. The company can afford to produce the product as much as possible in all geographical and climatic conditions. Because of this, apart from the employing the quality engineers, it also consider the material selection serious. Facility in the company is so sufficient to perform the full range of operations for construction and reconditioning of gas and oil pipelines, including construction of roads and access roads, helicopter pads, buildings and facilities with all communication lines. It should be possible to reach to every path.

Figure 55 Global warming A7. Worker availability (both white collar and blue collar) In Turkey, there are lots of people who can be classified into graduation of the university, high school or elementary school. This number is can regarded as a great number and skilled number. Because of the economic conditions in Turkey, the industries cannot employ the people with good salary conditions. For example, every person who is graduated from the university expects to work under the perfect opportunities and good wage. In order to have a job in this industry, there are some knowledge, skills, and abilities. For knowledge, first of all, the knowledge experience can be separated into 2 groups like mechanical group and production and processing group. The mechanical group is an experience

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of machines and tools knowledge. This included the machines designs, uses, repair and maintenance. The second one is that production and processing is information about raw materials, production process line, costs, quality control on the materials and tools, and some techniques to maximize the manufacturing process and logistic situation. For skills, there are many skills needs to be employed. 10 skills can be given with definitions. 1) The equipment maintenance is about routine of the process. The person should aware of its time of maintenance, equipments and the materials 2) Operation Monitoring checks the working conditions. In other words, the person will control that the machine is works properly. He can watch the gauges or dials. 3) Operation and Control checks the equipment and system progress. 4) Troubleshooting controls the errors which lead to some causes of the machine. 5) Active listening listens to what other peoples tell about the machines. 6) Reading Comprehension understands written documents and add some sentences or paragraphs in those related documents. 7) Critical Thinking focuses on the problem solutions techniques. The person will identify the strengths and weakness of the problems. By using the logic, he will approach with some solutions. 8) Learning Strategies determine the training, instructional methods and procedures for the new applications on the machines. 9) Quality Control Analysis conducts some tests of the products, services, maintenances to increase performance of the machine quality. 10) Monitoring is done to reveal the performance of the workers, organizations, machines, improvements or non improvements.

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Figure 56 Planning For abilities, there are many abilities needs to be employed. Again 10 abilities can be given with definitions. These abilities focus on the experience about the function of the machines, the direction of the workers and sudden intervention. 10 abilities can be classified with their tasks as follows: 1. Control Precision is to adjust the machines or vehicles into exact position. In other words, the machines will be functioned with respect to demand positions. 2. Oral Comprehension is to listen and understand the thoughts and the information from the other people. 3. Problem Sensitivity is to recognize the problem. This is not included in a solution of the problem. The person can realize that something is going wrong. This is a type of problem recognition. 4. Finger Dexterity is to coordinate the movements of the fingers to grasp, manipulate and assemble materials and tools. 5. Arm Hand Steadiness is to make the hand and the arm steady while moving the arm or to put the hand and the arm in one position while holding the arm. 6. Manual Dexterity is to use the hand alone or with the arm to grasp, manipulate or assemble the objects.

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7. Near Vision is to get the details at close range. 8. Oral Expression is to adjust the communication of the ideas and information in speaking. This is because the other people can understand those ideas and information. 9. Reaction Time is to give a response with the hand tool to a signal like sound, light, picture. 10. Inductive Reasoning is to combine all pieces of the ideas to obtain general conclusions. Today, some companies also give a education to meet the worker capacity. With this respect, the ordinary people can be got education for the future process of the company. The population in Turkey is so high. There is high ratio unemployment in Turkey. According to Türkiye İstatisik Kurumu, The ration of the unemployment is %9.9 in 2006. As a number of the workers, there is no any problem; however it is difficult to find the skilled and experience workers because of the insufficient education conditions. A8. Capital availability; The capital availability is a problem for almost all the industries. It leads to making itself superior among the other companies. The target audience of the company is chemical, mechanical, plant, process, and design engineers; plant, process, engineering, and maintenance managers; and other professionals concerned with extrusion. To manufacture of extrusion machine, there is a need to have high capital availability. This is because this machine has raw materials and equipments. It consumes energy and needs to maintenance. It is difficult to find well skilled workers regarding maintenance. And lastly, the cost of workers comes out. In Turkey, the supplement of those factors like raw materials, equipment or workers is more difficult than China, Europe or ABD. This is because Turkey gets the some raw materials and equipments from outside. The well qualified workers are not sufficient. In other words, it is so costly. Also the energy reserve is very limited. For example, two or three months ago, there is reserve problem regarding water. If water runs out at one time, the usage of electric will be depended on the outside of country. That means the high cost.

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Figure 57 Capital Availability A9. Global warming; Climate changes can affect the manufacturing process. Therefore, it is necessary to have climate control in the manufacturing places. This leads to keeping in temperature balance with respect to producing the machine. This climate control will not only contribute to produce extrusion machine under the well conditioned place, but also it leads the employers to work under the comfortable and cooled place.

Figure 58 Global Warming A10. Economic crisis due to earthquake The earthquakes are an indicator for the people to make their decisions more seriously. The effects of earthquakes can be reduced with some precautions. To illustrate, the place must be selected carefully with respect to dangerous zones. In other words, place which the factory is established must not be become in the first degree dangerous zone. This is most important factor to preserve the factory and tools in a safety. However, this economic crisis because of the

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earthquakes can affect the raw material supplier or any other factors which have contribution of producing machine. At that time, the company can find any other supplier which is not affected by the economic crisis.

Figure 59 Economic Analysis A11. Economic crisis due to possible regional wars that our country may be involved in The economic crisis is always a very serious problem for many countries without looking at the causes of it. In other words, the economic crisis because of regional war, disaster, or any other reasons is not important. Almost all the conditions can affect highly on the work conditions. If it is emphasized more specific as a regional war, its results can create a serious problem. The company profile is not embodied with its demands, workers and its popularity. There are other indirect effects like stock market, foreign exchange and the some economical factors like inflation or deflation. Under the possible wars condition, these factors can change dramatically in a negative way. For example, the raw materials are supplied from abroad. This means that the company will pay the bills with foreign money. At this respect, because of the inflation, the company can suffer losses about money. A12. Economic crisis due to other reasons If the company has papers in BORSA, this can leads to an economic crisis for that company. The values of the papers can decrease, and this can affect the financial position of the company.

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Figure 60 Economic Crisis A13. Significant changes in Dollar ($) and Euro (€) parities The changes of parities in Euro or Dollar are so effective the future condition of the company in Turkey. The people in Turkey have many experiences with economic crisis because of the sudden changes in Euro or Dollar. For instance, if the company supplied some raw materials from outside or the company has some payments to the foreign company, this crisis can lead that company to go bankrupt or to lose more money. Therefore, the economic policy must be planned properly or carefully.

A14. Other factor that I can think of is advertisement. In order to be known by the customers, the company should have a very close contact with the media. The media can make the company the superior among the other companies. Also, the advertisements can be put on the popular activities like sports, magazine or conferences.

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Figure 61 Advertisement How do the following decisions/parameters change with respect to the above factors? B1. Type of production system selected (ex: job shop, flow shop, etc) B2. Raw materials and/or subcomponents used in manufacturing the product B3. Selected layout for the manufacturing facility B4. Supplier selection for equipment B5. Supplier selection for raw materials B6. Fixed costs for establishing the production facility B7. Unit production costs B8. Fixed costs for orders (depending on the order size, i.e. the number of machines ordered)

A. Impact of A1, A2, A3, A4, A5, A7 and A8 on B1 First of all, A2 and related to it, A3 have the most desired effects on B1. A3 is related to A2, because the demand for the product in the whole market determines what the demand for a single company’s products will be. If the general demand on the product is high, then the demand on the company’s product also will be high. That is why A2 and A3 will have the same effect on B1. Now discuss what this effect will be. If the demands are very high such as more than 100 machines per month, the production should be in a quick manner. Another point will be that the company should not wait for the demand to produce the product; there should be a continuous

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production. So the most suitable production system for such a condition is the assembly line. If A2 and A3 are low let say about 5-10 products per month, then you can choose a job shop production system, where you will produce only if there is an order for your product. Actually, A2 and A3 determine A1, the production volume characteristics. It means, you choose your production volume characteristics according to demand. So if the demand is high, you have a high mean of production and the reverse in the other way. So we can say that A1 has the same effects as A2 and A3 on B1. There are also other factors which have impact on B1. A4, for example, is also important for B1. The location of the company is important, because it can change the demand on the company’s products. So if the company is located to near of big cities or organized industrial regions, it can need an assembly line again, because its sales will be higher compared to a company which is far away from such centers and whose transportation costs are higher. Also the area and volume of the company is an important factor on choosing the production system, because you may need a wide and big place to perform an assembly line. On the other hand, a batch flow could need a smaller place to perform. Apart from these A5, A7 and A8 also have effects on B1. A5, the various product characteristics may directly affects the production system. If the product consist of many subcomponents and parts, it may be more logical to have a batch flow system. These different parts can be produced at the same time and then brought together. For the extrusion machine, a batch flow can be selected for instance, because the machine has many little parts. By producing it by an assembly line could take a very much time and there should be a big place to have such as an assembly system. But if the product is easier to produce and consist of fewer parts, an assembly line can be selected for a quicker production. A7, the worker availability, also plays a role in the production system. If you do not have enough number of workers to produce the subcomponents of the product separately at the same time, then it would not be reasonable to choose a batch flow to produce. So you should choose the assembly line in a condition like this. As said before, the extrusion machine has many subcomponents and parts. So you should have many workers available if you want to produce this product by batch flow system. If you do not have, you should choose the assembly line system. And lastly A8, capital availability, has also impact on

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the selected production system. It is parallel to A7; if you do not have enough capital, then you cannot have enough number of workers and that means an assembly line. Another point is that you should have capital for the machines, too. For example, for an assembly line, you should have a system where the components are scrolled on a line and the machines for this system means money.

B. Impact of A5, A8 and A13 on B2 A5 has the most important effect on B2, because the characteristics of the product determine the raw materials and subcomponents used in manufacturing it. If you want to produce a hard product, you should choose raw material with high strength. Or if you want to have a soft, more flexible product, then you should use raw materials alike to plastics. For example, by our product, the extrusion machine, raw materials such as metals and steel should be chosen. But there are also some parts which should be made of plastics. Of course, your capital availability is also significant by choosing the raw materials. If you have enough capital, then you can produce products of higher quality, where you use the best and most suitable raw materials. But if you do not have, then you begin to look for ways to decrease your production costs and you choose cheaper raw materials and you have a worse quality. Another factor which affects B2 is A13, significant changes in Dollar and Euro. This can change things especially for the companies which import their raw materials from foreign countries by Dollar or Euro. By a change in Dollar or Euro, their raw materials’ prices can rise suddenly and they should change their supplier or raw material in such a condition.

C. Impact of A1, A2, A3, A4, A6, A8, A9, A10 and A11 on B3 All A1, A2 and A3 are connected to each other for their impacts on B3. The connection between A2 and A3 was written before; if A3 is high, then there is tendency of a high A2. And these two have again a similar connection with A1. It is, if the demands are low, to have a high production

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volume would be senseless, so you have a low production mean. If the demands are high, the production volume is also high to meet the demand. If all of these A1, A2 and A3 are high, which means that you have a high production rate and high demand for your product, then you are willing to have your company in a good layout, because you have to transport your products easily. A4 is almost the same thing as B3, because location with respect to major demand locations is directly a reason for the selected layout for the manufacturing facility. A6, geographical and climatic conditions are indispensable for the layout selection of the company. For example, if you want to ship your products by seaway, then it is important that you locate your company near the seaside. Or if you have a company at the top of mountain let say, it would be very hard to reach the company and ship company’s products. Also the climatic conditions should be considered. An example for the climatic conditions can be that you select the layout of your company in a town in Erzurum. Then you should venture that the roads will be close for many days in winter because of the snow and your shipment can be made only in 8 or 9 months in a year. A8, the capital investment determines the layout of the company. It is obvious that being located in the middle of the big cities or organized industrial regions is more advantageous than being located in a small town. But to select a layout for the company in an advantageous are such as city centers is always very costly. For example, if you want to buy an area for your company in Levent, İstanbul today, you should pay a lot of money. But you can buy an area in the same size in Erzurum by paying much less. So if the capital investment is not so high, there is not a big chance to select a good layout for the company. A9, global warming, should be also considered by selecting B3. Global warming has not become a fatal thing in Turkey yet, but it will become slowly. By choosing the layout of the company you should take care of that the company is not located in a dry area, because it can become much drier due to global warming. Another point can be that the sea level should be considered. In Turkey, the sea level does not change so significant now, but for example in Holland companies and houses at the seacoast are moved into the inner areas, because the sea level arises very dangerously. This situation may occur in Turkey in the forthcoming years in Turkey.

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A10 and A11 are economic crisis based on two different reasons. First reason is the earthquake. First of all the layout of the company should not be selected from a region with a high risk of earthquake. This is the direct effect of A10 on B3. The second reason of the economic crisis is a possible regional war. How it affects the selected layout of the manufacturing facility is that the regions next to the countries, which can be the possible enemies in a war, should not be selected as layout. For example, there is a conflict between Turkey and North Iraq nowadays because of terrorism and there is a possibility of a forthcoming war in this area. So to choose the layout of the company in Yüksekova, Hakkari is not logical.

D. Impact of A4, A5, A8 and A13 on B4 The manufacturing facility characteristics, A4, affect the supplier selection for equipment, because the area and volume of the company determines which equipments can be used in it. And location of the company is also important by selecting the equipment supplier, because suppliers near the company are preferred because of the lower transportation costs. Of course, various product characteristics (A5) are is the main criteria for equipment and equipment supplier selection. The equipments in the company should be selected according to the product characteristics. So the equipment supplier which can lead the exact needs for the production will be selected by the company. The capital investment (A8) of the company has a great influence on the supplier decision. The equipments are very important and a long term investment. That is why they should be selected properly, but if the capital investment is not enough equipments of less quality should be selected. So the capital investment makes the company to select a suitable equipment supplier. Significant changes in Dollar and Euro (A13) affect the decision of the companies if they want to select their equipment suppliers from abroad or from supplier which work with firm abroad. For example, if a sudden increase in Dollar or Euro occurs, it can be more advantageous for the company to work with a regional supplier.

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E. Impact of A1, A2, A3, A4, A5, A8, A11 and A13 on B5 A1, A2 and A3 can have impact on B5 in such a way that the unit prices for the raw materials of the suppliers can change depending on the order size. The demand on the product and the production volume determines the order size for the raw material. If you produce more, you order more. Some suppliers can be more advantageous for small orders and some can be more advantageous for large orders, because the unit cost may decrease for large orders. It can be said that A4, A5, A8 and A13 have the same impacts on B5 as discussed above in D on B4. The difference is that the suppliers are for equipment and for raw material, but for the factors 4, 5, 8 and 13 it does not matter. The impacts stay the same. Different from B4, A11 (economic crisis due to possible regional war) has an effect on B5. If the company has a trade with a country for its raw material, the relationship between this country and company’s own country is very important. If there is a risk of a possible war between these countries, the company should find another supplier in another area. For example, if the company supplies their raw material from Iran and if a war occurs between Iran and Turkey, the company cannot get its raw materials anymore. An embargo can be imposed on the trade between these countries, so the company should change its supplier.

F. Impact of A1, A4, A6, A8, A10, A13 and A14 on B6 The production volume characteristics, A1, change the fixed cost for establishing the production facility. If the production volume of the company will be high, then more equipment should be bought to meet the high production rate. But if a company with a low production volume is opened, then not so much machines are needed and the company’s fixed cost to establish decreases. The area and volume of the company (A4) has the same effect on the fixed cost. Lower area and volume means less equipment and less establishing fixed costs. Another

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important factor for the fixed establishing cost is the location of the company. This affects the fixed costs for establishing the company very much, because to buy the area for the company is one of the biggest parts of the establishing cost. As discussed before, if a location in the city centers or near the big organized regional areas are selected, the fixed cost can be very high. Geographical and climatic conditions (A6) can also be included in the fixed costs for establishing. You may need to make some necessary attachments to the company to fit in the geographical or climatic conditions. For example if the company is established in a very hot or cold region, some air conditioners are needed in the company. Or if the company is in a bad geographical area, it may need to build some new ways to reach the company. As it has effect on many different parameters, the capital available (A8) has an impact also on B6. It directly determines the fixed cost for establishing the production facility. The layout of the company, its size, equipments should be selected according to the capital. The earthquake (A10) may also influence the fixed costs for establishing, because if the company cares about the earthquake, it searches for a safe area and a healthy building. If the company’s building will be build newly, it should be build long lasting, which can increase the fixed cost. Apart from these, an economic crisis in the country, no matter what its reason is, (A12) will affect the fixed cost to establish a company directly. All the land, equipment prices can change quickly in a crisis. The conditions to open a new company can be very harsh in such a crisis. The last factor we can think of which can affect the fixed cost to establish a company is the advertisement. If the company wants to be known widely, it should make a good advertisement on the boards, in TV and radios etc. These advertisements mean money and it can counted as establishing cost, if the company wants to let his name known by people as it is established. G. Impact of A1, A4, A5, A7 and A13 on B7 Production volume characteristics (A1) play an important role in unit production cost. If you have a large volume of production, which means that you can produce many products at the same time by one process, the unit production costs will be lower. But if you are a small producer, then your unit production cost is expected to be high. It depends also on the area and volume of the company (A4). A small company cannot produce a lot at the same time.

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Product characteristics are main criteria for the unit production cost. Is the product a complicated one to produce, what kind of raw materials are used for the product? These all are strongly related to unit production cost. Another factor can be the workers available. How many workers work to produce the product? Are they highly skilled workers? What are their wages? The answers of these questions are also added to the unit production costs. The last factor that affects the unit production cost is the significant changes in Euro and Dollar, which can change all the raw material prices and workers’ wages. It means a significant change in unit production cost.

H. Impact of A1, A2, A3, A4, A6, A12 and A13 on B8 A1, A2 and A3 again together have an impact on the fixed cost for orders. If the demands are high, the company’s production volume should be also high. It means that the company produces large number of products and that is why large order sizes are made by the company. Large orders mean low fixed costs for orders. A4, the location of the company is very important for the fixed order costs; if the company is located near the supplier or in a region easy to reach, the fixed cost for the order decreases, there the shipment cost is lowered. But if the company is located in a far away area or in a area very hard to reach (such as in an island or at top of a mountain) or in area with a bad climate (for example in Erzurum; very hard to reach in winter) then the supplier may demand a higher order cost for this company. As seen above the geographical and climatic conditions are also important (A6). The last topics involved in the order cost are the economical crisis and significant changes in Dollar and Euro. These both can change everything in the economy and the costs can rise suddenly.

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Figure 62 Excel sheets of the impacts

5. SWOT analysis First of all, it should be known what a SWOT analysis is to make it. SWOT Analysis is a strategic planning tool used to evaluate the Strengths, Weaknesses, Opportunities, and Threats involved in a project or in a business venture. (http://en.wikipedia.org/wiki/Swot_analysis) This SWOT analysis will belong to the company that is going to be opened. In this SWOT analysis, the strengths are the attributes of the company which will lead the company to achieve its objectives. On the other side, the weaknesses are the attributes which will balk it from achieving the objective or will harm the company by achieving the objective. Opportunities, like strengths, are helpful for the company and threats, like weaknesses, are harmful for the company to achieve its objectives. But they are different from strengths and weaknesses, which are internal factors, as they are external factors.

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Figure 63. SWOT Analysis There is also SWOT matrix (also known as TOWS matrix), which is a matrix of factors, where opportunities and strengths form S-O, threats and strengths S-T, weaknesses and opportunities W-O and weaknesses and threats W-T strategies. S-O strategies pursue opportunities which fit the company’s strengths well. W-O strategies are to overcome weaknesses to pursue opportunities. S-T strategies point out the strengths of the company which can be used to overcome external threats. Lastly, W-T strategies are such as defensive plans, which prevent the company from getting highly damaged by external threats because of its weaknesses. (http://www.quickmba.com/strategy/swot/) The companies can use SWOT matrices to develop better competitive strategies. SWOT analysis is important for all the companies, as they use it to develop their self knowledge and to develop the company’s competitive position. There exists some software for SWOT analysis, which are widely used by the companies. One of them is SmartDraw, which can be tried for free. It quickly and easily creates SWOT analysis diagrams and guides the user through the process.

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Figure 64. SmartDraw Software 5.1. How much domestic market is there for the product? How do you think will it change? In Turkey there is a small domestic market compared to global market of extrusion machines. The market depends on import rather than export. Total import of Turkey is made mainly from Germany, Switzerland, Italy and France. Approximately $100,000,000 was paid to Germany in the last 5 years for extrusion machines. On the other hand, export is very small compared to import in domestic market. The highest export value in the last 5 years was achieved in 2005 and it was about $5,000,000. The countries, where the most export is made are India and Azerbaijan. That is just one twentieth of the money paid to Germany in the 5 years. To sum up, there is not enough production of extrusion machines in Turkey. Some machines are exported, but the import is much more than the export. The related statistics about the domestic market are given below;

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Period

2002

2003

2004

2005

2006

Trade Reporter Partner Flow Import Turkey

Import Turkey

Import Turkey

Import Turkey

Import Turkey

Commodity

Trade Value

NetWeight (kg)

Trade Quantity

Unit

World

Machines for preparing textile fibres, other than $47,015,962 carding/combing/drawing/r ... [HS2002 code 844519]

3,187,710

Number of items

610

World

Machines for preparing textile fibres, other than $71,702,251 carding/combing/drawing/r ... [HS2002 code 844519]

3,845,567

Number of items

859

World

Machines for preparing textile fibres, other than $48,515,946 carding/combing/drawing/r ... [HS2002 code 844519]

2,384,417

Number of items

810

World

Machines for preparing textile fibres, other than $48,577,200 carding/combing/drawing/r ... [HS2002 code 844519]

2,670,162

Number of items

491

World

Machines for preparing textile fibres, other than $19,485,446 carding/combing/drawing/r ... [HS2002 code 844519]

1,130,206

Number of items

285

Figure 65. Imports of Turkey Between 2002 and 2006

Top Import Partners in the selection (View Map) Partner Title

Trade Value

Germany

$99,378,879

Switzerland

$54,691,250

Italy

$29,667,833

France

$29,003,645

Japan

$8,391,961

Other partners

$14,163,237

Figure 66. Top import partners of Turkey between 2002 and 2006

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Figure 67. The map of the exporters of Turkey The map shows from which areas Turkey buys extrusion machines. Much of the points meet in Europe, especially in Germany, Switzerland, Italy and France.

Period

Trade Flow

Reporter Partner Code

Trade Value

NetWeight Quantity (kg)

Unit

Trade Quantity

2002

Export

Turkey

World

844519 $1,143,699

325,766

5

1,150

2003

Export

Turkey

World

844519 $1,328,368

495,379

5

599

2004

Export

Turkey

World

844519 $4,306,885

649,018

5

329

2005

Export

Turkey

World

844519 $5,189,450

1,551,476

5

517

2006

Export

Turkey

World

844519 $1,824,322

996,983

5

148

Figure 68. Exports of Turkey in the last 5 years

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Top Export Partners in the selection (View Map) Partner Title

Trade Value

India

$3,171,539

Azerbaijan

$2,424,124

Free Zones

$1,792,687

Syria

$1,560,038

Egypt

$710,924

Other partners

$4,133,412

Figure 69. Top exporters of Turkey between 2002 and 2006

Figure 70. The map of the importers from Turkey The map shows that the export locations for Turkey are mostly located in the East.

As it can be understood from the statistics, the domestic market is not stable. For example, import increases from 2002 to 2003, then it decreases from 2003 to 2004 and it again decreases from 2004 to 2005. By exports there is a rise for 4 years from 2002 to 2005, but there was a

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decrease between 2005 and 2006. So it is hard to estimate the future of the domestic market, but by paying attention to the developments in the machinery and technology, where the extrusion machining is used very commonly, it can be said that there will be a rise in the domestic market. It should be also considered that the prices for both export and import of the extrusion machines increase. For example in 2004, 810 machines could be imported for about $48,000,000, but it decreased to a 491 machines in 2005 for almost the same amount of money. By exports it is the same; in 2002, 1,150 machines should be exported to become $1,150,000, but in 2006, $1,800,000 can be gained only by 148 machines. So, there the prices of the machines increase, it becomes for logical from day to day to produce it by own rather than importing it. That is why it can be said that in domestic market there will be a need for companies, which will produce extrusion machines. These companies can be advantageous over the companies in the global market, because importing prices are very high. If the machines are produced and sold in the domestic market, it can save money for the customers. In other words, there is a great potential for such a company in domestic market.

5.2. How much global market is there for the product? How do you think it will change? As it is noted before the extrusion machinery is used widely in many different areas. That is why it has a huge domestic market. From the databases of Comtrade database of United Nations (UN), it can be seen that the market is huge and it tends to grow. The leading country for exports of extrusion machinery was Germany in 2006. Italy, Switzerland, France and USA were following him. Germany had a total export of $156,893,000, where the total import was $493,811,247. The leading country for the imports was India in 2006 and Pakistan, China, Turkey and Germany were thereafter. India had a import of $48,938,586, where the total import for 2006 was $250,733,805. The statistics below show the values of the 5 leading countries for imports and exports in 2006;

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Top Importers in the selection (View Map) Reporter Title

Trade Value

India

$48,938,586

Pakistan

$30,042,948

China

$22,000,204

Turkey

$19,485,446

Germany

$13,118,000

Other reporters

$117,148,621

Total Import: $250,733,805 Figure 71. Top importers in the world in 2006 Top Exporters in the selection (View Map) Reporter Title

Trade Value

Germany

$156,893,000

Italy

$74,732,513

Switzerland

$54,069,878

France

$41,039,593

USA

$37,512,811

Other reporters

$129,563,452

Total Export: $493,811,247 Figure 72. Top exporters in the world in 2006

If we look at the table of the imports and exports for the last 5 years, we see that the order of the leading exporters is the same as in 2006. There is a huge gap between Germany’s exports and the countries’ below it. Germany’s export is nearly a triple of the follower Italy.

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The order of the top importers for the last 5 years is a bit different than the importers of year 2006. Turkey seems to the leading country for extrusion machines’ import in the world. It consumed a $235,296,805 for extrusion machines in the last 5 years. Pakistan, China, Thailand and India follow him, where the total import was $1,462,150,821. The statistics below show the numbers for the last 5 years;

Top Importers in the selection (View Map) Reporter Title

Trade Value

Turkey

$235,296,805

Pakistan

$132,628,003

China

$119,867,048

Thailand

$116,034,624

India

$113,643,745

Other reporters

$744,680,596

Total Import: $1,462,150,821 Figure 73. Top importers in the world in the last 5 years Top Exporters in the selection (View Map) Reporter Title

Trade Value

Germany

$1,098,963,000

Italy

$350,792,757

Switzerland

$207,330,628

France

$182,229,600

USA

$178,785,190

Other reporters

$512,299,105

Total Export: $2,530,400,280 Figure 74. Top exporters in the world in the last 5 years

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The first map below shows the leading importer countries of the extrusion machine in the last 5 years and the second map shows the exporters for the same conditions;

Figure 75. Top importers in the world in the last 5 years

Figure 76. Top exporters in the world in the last 5 years

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Recent Import Years in the selection Period

Trade Value

2006

$250,733,805

2005

$330,888,815

2004

$334,168,716

2003

$293,019,223

2002

$253,340,262

Figure 77. Import values of the last 5 years Recent Exports Years in the selection Period

Trade Value

2006

$493,811,247

2005

$474,145,066

2004

$645,227,663

2003

$498,963,822

2002

$418,252,482

Figure 78. Export values of the last 5 years

As the recent imports and exports of the last 5 years above show, the global market is also not stable like the domestic market for this product. There are generally increases in the exports and imports, but sometimes decreases also occur. For example, between 2005 and 2006, the imports were decreased by about $80,000,000 and the exports were decreased between 2004 and 2005 by about $170,000,000. These examples tell that the market is not stable and it does not grow continuously. But such as for the domestic market, it can be again said that the market for this product tends to grow up, because the areas where the machine can be used are expanding and accumulating every day due to developing of technology and machinery rapidly and continuously. It means that more need for extrusion machines will be there, as these machines are used in a very wide variety of production. For example, in 2006, China produced more than

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25,000 extrusion machines and the extrusion machining is becoming more indispensable from day to day for China’s machinery export. (http://plastics.2456.com/eng/epub/n_details.asp?epubiid=3&id=1981). This example clearly shows the importance of the extrusion machinery and its future.

5.3. (S) Strengths of operating in Turkey and strengths that you believe do not exist in other companies to the degree that you have First of all, it is obvious that extrusion machinery has a very large market, but it is not developed in Turkey yet. It means that the market in Turkey tends to grow in future and extrusion machining is a potential profitable area in Turkey. It is showed in part 5.1 that imports of extrusion machines are low in Turkey. So if a company is established in Turkey, it will not have many global competitors. Companies in domestic market will be the competitors and they can be passed. That is why operating in Turkey is advantageous and can be seen as one of the company’s strengths. Apart from that other strengths of the company can be listed as; 

As the company is newly constructed, skilled, determined workers, who can bring the company to a pretentious place in the market, can be selected and hired.

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Quality processes and procedures can be carried out in the company.

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At the beginning there will be a small amount of customers and work, that is why a really good customer care can be given to those customers and some loyal customers can be gained and a good prestige can be achieved in this way.

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Being a small company at the beginning also means little overhead, so prices can be kept low, which makes the customers to prefer our company. Low prices can be advantageous to enter the market, too.

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

Last point is that a small company can easily change direction if the approach does not work. In a big company with many workers, machines and processes, it would be very hard and costly.

5.4. (W) Weaknesses compared to local and global competitors 

The company should start with a weak brand name, which means that the customers will not know the company at the beginning and will look at the products of the company a bit suspiciously.

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The company needs some time to get known and preferred because it has no market reputation and presence at the beginning.

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The cash flow may be insufficient, if the builders do not have enough capital at the beginning.

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The patents of the products that you want to produce or the machines that you are going to use in production can belong to others and that is why you should pay money for them.

5.5. (O) Opportunities in the domestic and global market 

In Turkey, there is a small market for the product, which can be entered easily and then even dominated.

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The number of the companies which are associated with this area is low, in other words there are not so many competitors for the company.

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The business sector is expanding, so there will be many opportunities and chances to success in the future for the company.

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The competitors may be too slow to adopt new technologies and approaches, as they have a steady system and it can be hard to change it.

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To see the opportunities in the market better we carry the data of the exporters, importers and the trade values between them in an Excel sheet and then use them in Omniscope to analyze them. Here is a general view to the market;

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Figure 78. Omniscope- General view

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If we look at the imports of the countries separately, we realize that there are opportunities for our company especially in Iran, India and Romania. In the market of Romania there exist 5 exporters including Turkey, USA, China, France and Germany. This market is advantageous for our company, because Turkey is already one of the exporters, so Turkish machines are familiar in Romania and a new company from Turkey can enter the market if it produces high quality products with low prices. Another point is that there are not so many competitors in the market. Companies in Turkey have an advantage over the other one; they are more close to Romania, that is why transportation from Turkey can be made more easily and service and lead times will be shorter. So, Romania is a good opportunity for our company. Other opportunities are the market in India and Iran. There are a few exporters to Iran and Turkey is not one of them. If the political problems can be passed beyond, then a company from Turkey can dominate the market in Iran against the existing exporters, China, France, Germany, India and Switzerland because of its near location to Iran. And the last opportunity is the market in India, where companies from Turkey already exist. This market is a good opportunity, because India is one of the biggest importers of this product in the world and Turkish products are already sold there. In other words there is a huge market in India for the product and you do not to become dominant in there to make good gains. If the company becomes one of the known Turkish companies in India, a lot of machines can be sold to India. That is why this market is a big opportunity, which should be entered. The related tables belonging to these 3 markets are given below;

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Figure 79. Omniscope for the market in Iran

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Figure 80. Omniscope for the market in Romania

Figure 81. Omniscope for the market in India

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5.6. (T) Threats to the success of the business and ways to avoid or minimize them  A possible earthquake in the region of the company or the customer companies, which can cause to breaking down of the companies. This threat can be avoided by building the company in a safe region and strongly. But there is nothing to do when your customers do not have safe buildings.  A possible regional or global war which may affect the country’s economy. The precaution to minimize the damage from a war can be not to trade with companies of a possible involver of a war. The company should always have other options and approaches for such an unexpected threat.  A possible economic crisis, which can make the purchasing power decrease and the manufacturing costs increase. Economic crisis can often occur in Turkey, that is why a company should determine its strategies in a possible forthcoming crisis and apply them when it occurs.  The market can be changed or improved due to developments and changes in technology and the company may not adopt these new changes, so it can not be a competitive company in the market any more. The solution for this treat is to watch the developments and innovations in technology very closely. The company can even have an innovation management facility to adopt all the innovations in the technology.  The changes in the strategies of large competitors may affect the market and company very efficiently. It can cause to wipe out the market position the company has achieved. At the early levels you cannot do anything about this situation, you just can hope that such a thing does not happen. A possible prevention is maybe to work to grow up rapidly, so you are not affected by decisions of large competitors.  There can be price wars with the competitors and these wars may make the company to lose money. Especially large competitors may reduce the prices very much and small ones cannot answer it. The possible prevention is the same as the above one again.

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 A new competitor may enter the market. The company should always take into account a possible new company entering the market by determining its strategies. The company should produce products of high quality and minimum possible cost, so other companies cannot compete with it.  High taxation may be introduced on the product or service by government. Here again, you have nothing to do, you just wish that the government does not do it.

6. Service System 6.1. Detailed Service System The service system is very important for the customers’ happiness of the company. All the customers want to buy products of good quality with appropriate price, but that is not all. Even products of good quality may be broken down after some time. At that point the customer expects the company to solve his/her problem with the product. The company should deliver service by its configuration of technology and organizational network to meet the demands and needs of the customer. (http://en.wikipedia.org/wiki/Service_system) Its service system is also an important criterion by choosing a company such as its products’ prices and quality. That is why it should be established properly. We plan to sell extrusion machines to both local and global customers and extrusion machines may broke down after some time. So our company should have an organized and broad service system, which can meet the needs and wants of all the customers. First of all the locations of the service centers should be selected. Presuming that the company is located in Istanbul, Izmit or Adapazarı, one service center will be located in the location of the company, because repairs can be also made in the company where the production will be made. We assume that the products will be sold to all over Turkey. That is why we need 3 more service centers in Turkey at the beginning. One can be located in Ankara and serve there and in the East of Turkey. For example, if there is a problem in the machine, which is sold to a company in Sivas, it will be sent to the service center in Ankara, repaired there and then will sent back to

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Sivas. The third service center should be located in the South of Turkey, in Antalya or Adana. We think that Adana could be better, because it is more developed in industry than Antalya and more machines can be used there. This third service center is responsible for southern Turkey. The fourth and last service center will be located in Izmir, in the Western of Turkey. These service points will be adequate for Turkey at the beginning. If the company grows in the later stages and its sales increase, then other service points can be opened looking at the areas where the most sales are made. For example, after 5 years the company may begin to sell a noticeable number of machines to Trabzon. Then if the service demand cannot be met by the service center in Ankara, a new service center can be opened in Trabzon. Mostly high way and sometimes railroad will be used by the services. That should be also taking into account. Transportation can be a serious problem in the Eastern of Turkey especially in winter and that is why a service center in the East can also be opened if the sales to this area are high. One of the Erzurum or Erzincan could be selected for the service center location in the East. The service to the customer outside of Turkey will be harder. We think that it is not logical to open a service center outside of Turkey at the beginning. If the company gets really strong by the time and becomes one of the competitors in the global market, then service centers can be opened abroad. But at the early stages the products of the customers from abroad can be brought to Turkey and they can be sent back after the appropriate service. İzmir and İstanbul can be the contact points for the customers in Europe or at the Black Sea, because they can be reached easily by the sea- or highway. If there are customers in the Middle East they can send the product to Ankara by highway or Adana by seaway. If there is a country to which the sales are really high, then a service center can be opened in this country to meet the wants of the customers more quickly. India and Azerbaijan are such potential countries, because they have high imports from Turkey. Selected and potential service centers are shown in the map below;

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Figure 92. Service centers in Turkey The lead times that will be quoted to customers depend on the location of the customer. In the domestic market the lead times will not be long, because we plan to open service centers, from which all the cities in Turkey can reached. The lead times in the domestic market will be approximately 1 week. The lead time may be a bit longer only for the cities in the East, because the transportation can be a problem. But if a service center is opened in Erzincan or Erzurum the lead times will also not exceed 1 week in the East. But for the global market, the lead times are much longer. It can take 1 or 2 months where the sea routes are used and up to 3-4 months where the highways are used. That is why it seems to be logical to have service centers in the countries where the company exports much. Of course another criterion for the time of the services apart from the destination is the kind of the defect of the product and how busy the service point is. If the product can be repaired easily, there is no problem, but sometimes is can take a long time or it cannot be repaired where it should be changed with a new product or the service center may be very busy at that time with waiting machines in the line and the product should wait in the service center for the repair. All these conditions may longer the service time. The services that will be offered by our company begin by a detailed manual of the product, which will be sent to the user by the product. We think that the manual is a type of service and it is very important, because the machines are complex to operate and many steps should be

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followed to operate them properly. The machines can be damaged if they are not used appropriately. That is why a detailed manual is the first step of the services. The manual will be in Turkish, English and different languages depend on the exporting countries. Apart from that the service points will work as call centers, where the customers can call and ask about their problems. If there is a need to repair the machine, there are two options. First one is; if the machine can be repaired where it is, then a repairman can be sent to the company and the service is given there. If the problem is more complex and it is impossible to repair it by a repairman in its location, then the machine is taken and brought to the service center or if needed to the company in İstanbul. If the problem is solved, it is then sent back to the customer. If the defect is because of the product, then it is repaired for free. It can be also changed by a new one if there is a flaw. But if the defect is due to mistake of the user, then the customer should pay for the service.

6.2. UML Diagram for the Service Systems

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Figure 93. UML Diagram for the service system 7. Profit Patterns and Competitive Strategies 7.1. Profit Patterns appropriate for the product and industry The profit patterns which will be followed by the company are very important for the progress the company will have. Right patterns can bring the company in a very good position in the market. Now, we look at the patterns which are most appropriate for our product and market. We will discuss the profit patterns under seven different topics. First of them is the channel. We think that the most appropriate channel type for our company and market is the concentration which is used by Carrefour, USA Waste etc, since the industrial capacity of the company and the market are high and technological innovations occur at a high rate and quickly. Apart from that we believe that there is an untapped opportunity to exploit in the economies of scale especially in the domestic market, since the market is growing and there are no real local rivals in the market. This means if the company succeeds beating the global rivals, it can have an exploit in the economy. If a new player, who is big enough to be a rival, enters the market, it results changes in a large scale, but the small one does not affect it so much. Customers are dissatisfied if the prices are high and that their selections are limited. So the appropriate profit patterns for this channel are acquisition of the smaller players and consolidation of some parts of the operation. Apart from these, customers can be made more satisfied through lower prices and better selections. In the customer topic, two different profit patterns can be chosen and applied to our market. One of them is redefinition, which is used by Coke and DuPont. It exists where the profits from traditional customers are low and players of decision-making are shifting to new actors. This situation is appropriate for our company and the market, because if a new and strong company enters the market, some players may shift to this new actor. It is also right that the profit from the traditional customers is low, because they often need service for their products and they do not tend to buy new products. There exists also an untapped group of customers and segments. So one profit pattern is to target these untapped customers and segment and getting high profit from them. The second strategy is profit shift, which is used by Kanthal. By this profit pattern

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you try to build strong relationships with highly profitable customers and you eliminate unprofitable customers. A company may use this pattern if it is strong enough to refuse to work with low profitable customers and it targets only the highly profitable ones. For the knowledge, product to customer knowledge will be used such as in Coke and P&G. This strategy involves little differentiation among products and in our market there are a limited number of products. Customers have preferences, price sensitivity and buying behavior. The profit pattern is the value creation where you make targeted sales and continuous, successful innovations. Efficient marketing can also be applied where inventory and stock out reductions can be made and mass marketing can be applied. In the topic mass, the company should work under “Back to Profit”, which is applied by Swiss and Starbucks. In this strategy, the customers’ priorities should be met and there are new applications exist and real innovations can be made. The profit pattern appropriate to our company is to make strategic and new business approaches. If good approaches are made, the company can rise easily in the market. For the organization, two ways can be followed. First of them is the skill shift, which is used by HP and Pfizer. By the skill shift customers’ priorities are highly important and they are future defining. In the market there exist some anticipating changes and current products, capabilities and services are still inadequate. This situation matches with the present domestic market. That is why it is logical to be able to make managerial, functional and technical shifts. These shifts are the profit patterns for a newly constructed company in the domestic market. Organizational focuses, resources and composition of skill sets can be changed by this pattern. Another scenario is that the company grows and becomes one of the leading companies in the market. Then the situation becomes “Cornerstoning” such as by Microsoft. The company’s growth rates are high, its future prospects exist, capabilities and strengths of the company are high and it has competitors in the market. In such a situation the profit patterns to follow should be maximization of the market share in the business core. Between the products, product to solution is the most appropriate for our product. After the sale of the product, value shifts to product parts sales and services can be made. Price and quality

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variations are high, since there are a lot of companies and therefore a lot of products. More than one vendor is needed for the production, because the product consists of many different parts and the coordination for the production and sales is hard to make. So, a profit pattern of integrated offering should be applied for our product, where a solution package is designed and delivered for the product, service and finance. The costs for the customers and the complexity of the operations are tried to be minimized. For the value chain, we have “Reintegration” which is used by Merck and LVMH. The relation among the chain steps are based on the benefit shift. The suppliers are weak and channel partners are inefficient. The profit pattern that should be applied is to have control over customer relationships and product presentation. The attractiveness and uniqueness of customer’s offerings can be enhanced. Apart from these balancing the power between customer and supplier and moving closer to the customer are effective ways.

7.2. Other Competitive Strategies First competitive strategy we can think of is advertisement. Especially in the early stages, advertisement is very critical. The company can have a known brand name by advertisement and it is a good reason to be chosen. Another strategy can be hiring experienced and creative workers in the industry, so the company may have efficient production and new ideas. For the new ideas even an innovation department can be created in the company. If the workers have really good ideas or strategies to improve the production or lower the costs, they can be given bonuses. The prices of the competitive firms should be checked continuously and some balances can be made according to these prices. If we have a large, strong company and if our unit production costs are low, then we can sell our products with low prices to eliminate weaker companies with higher unit production costs and we can be selected by more customers. If you trust to the quality of your products, you can give longer guarantee times than the ones existing in the industry. It makes people think that you produce products of higher quality than others and longer guarantee times are reason to prefer a product. Some promotions can be made at the beginning, for example installation of the machine can be made for free and then the first three services let say

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can be also for free. Other promotions can be given to the customers. An example can be that the customers can be sent to holiday to a hotel if they buy a certain number of machines.

8. Innovation Management Innovation is introducing of something new or a new method, idea or device in its simplest explanation. (http://en.wikipedia.org/wiki/Innovation) Improvements are made in the related area by introducing new things. So, establishing a culture of continuous innovation means that there should be always new introductions and improvements in the company. Innovations can be made in 5 different areas. First of them is the product innovation. In this type of innovation, a new and different product is created and developed or an already existing product is changed or developed and become something different than from its previous form. The source for this innovation is the needs of the customers. The demands will show the producers how and in which direction they can change the products. The second one is the innovation of the service system. In this one, a noticeable change should be made in the service approach or a nonexistent one should be found. The offering or distributing style of the existing system also can be changed. Banking through web was a good example for this kind of innovation. Another type is innovation in the process. That is about the production processes of the product. This innovation is made within the company, where more efficient production processes are tried to be found. The innovation in marketing the product is the fourth one. Some new marketing strategies and packing of the product is included in this part. The packs of some products can be very important for their sales, if they are attractive, they can be chosen more for example. The last type of innovation is about organization. New working styles and schedules can be introduced and the existing ones can be improved.

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For our company all of the product, service system, process, marketing and organization innovations can be made excluding the packing innovations. How to establish a culture of continuous innovation for all of these parts will be discussed below. First of all we begin with defining what a organizational culture of a company is. That is the shared experiences, norms, values and beliefs that shape the individual and group behaviors in the company. (http://www.1000advices.com/guru/innovation_culture_sk.html) Every organization has a culture, but our aim is to make our company to have innovational one. In many companies there are some training and development programs to teach the culture of the company to new employees and to lead the managers to become better leaders and influence the company’s culture. The culture of a company is shaped with all the external and internal events and decisions. The factors that lead to forming the culture of the company are shown below;

Figure 94. Model for the Establishing of Culture

External environment cannot be controlled by the company, but the other factor should be treated carefully. Leadership is how the leader or managers of the company make their decisions and influence the strategies of the company. This fact is very important, because most of the workers take the styles of the leaders as an example and they want to be like them. So an innovative leader or manager would encourage the workers to be innovative. Being an innovative leader self and hiring innovative managers can be the first step of creating a culture of

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innovation in the company. Processes are the strategies used in the company and accomplishing styles of the work. Structures are the formal organizing principles of the company which lead worker to collaborate and guide their behaviors. People include all the employees, suppliers, managers etc. These people perform together to achieve a common goal. Metrics and incentives are some measures which show the behavior of the individuals, departments and teams. And lastly technology, as it is known, is the abilities and capabilities to provide and deliver values. A vision of the ideal state of the company in the future can be constructed by the leaders of the company. This vision should have an innovative side in itself and should describe the importance of innovation to achieve the ideal state. So, in this way all the workers in the company seize the critical role of innovation and all can work for it. Communication with the employees is very important at that point. A strong and healthy communication should be created between leaders and workers, so that the goals and innovative approaches of the company can be understood well by the workers. Apart from these freedom of thinking and speech is very important by creating a culture for innovation. People should think freely and they should be free to speak out their ideas. Such an atmosphere should be created in the company, that no worker should feels himself/herself under pressure and that he/she should know that his/her ideas will be considered by the leaders. For such an atmosphere, the leader and managers should be open-minded. If a worker does not agree with his strategies, ideas or methods, he should listen to him carefully and take his worker’s ideas into the account. Colin Powell says about this topic: “If you have a yes-man in your organization, one of you is redundant.” (http://www.1000ventures.com/business_guide/innovation_system_culture.html) It clearly shows the importance of different ideas in the company. Other strategies that a company can or may be should establish are listed below;  Emphasizing not the past but the future  Giving possibilities to its workers, not constraints  Encourage workers to take risk if they really have a new idea

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 As it is discussed above ensure workers their personal freedom and trust all of them  Share all the information that you have with the workers in the company  Let departments to work together and cooperate, do not put barriers between them  Speak individually to workers if necessary and always try to motivate them  Encourage workers to think for the long-term  Award a prize to workers or departments if they are successful.

9. Framework for Planning a Manufacturing System

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Figure 95. UML Diagram for the Framework of the Project

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Retrieved from http://comtrade.un.org/db/ce/ceSnapshot.aspx?y=all&px=H2%20&cc=844519 2008, January 25

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Retrieved from http://comtrade.un.org/db/ce/ceSnapshot.aspx?y=all&px=H2%20&cc=844519 2008, January 25

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Retrieved from http://www.1000advices.com/guru/innovation_culture_sk.html 2008, January 25

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