How can I calculate the payback period after a packaging machine reduces labor costs?
• Payback (years) = total machine price ÷ annual labor savings; savings = headcount reduced × local fully-loaded annual labor cost.
• Total price must include the packaging machine, feeding/metering/heat-seal modules, installation, CE/FDA certification and spare parts.
• Deduct added electricity, air, film consumption, maintenance and operator retraining from gross savings to get net savings.
• If higher capacity adds gross margin, include that incremental margin in annual benefit to shorten payback.
• A payback ≤2 years is generally acceptable; >3 years requires rechecking cycle time, OEE and labor rate.
• Total price must include the packaging machine, feeding/metering/heat-seal modules, installation, CE/FDA certification and spare parts.
• Deduct added electricity, air, film consumption, maintenance and operator retraining from gross savings to get net savings.
• If higher capacity adds gross margin, include that incremental margin in annual benefit to shorten payback.
• A payback ≤2 years is generally acceptable; >3 years requires rechecking cycle time, OEE and labor rate.