Today, companies have to cope with increasing competitive pressure, rising labor costs, and constantly growing customer expectations. One of the prominent solutions in this challenging environment is automation investments. However, like any investment, automation investment raises the question: “When will this investment pay off?” The answer to this question can be decisive in businesses’ future-oriented decisions. This article will comprehensively examine the investment return process, depreciation periods, the cost-effectiveness of industrial automation systems, and analyses conducted under various scenarios.
Why is Automation Investment on the Agenda?
While labor costs are rising in most parts of the world and finding qualified personnel is becoming increasingly difficult, companies are finding a solution in industrial automation systems. Automation investment not only increases efficiency; it also standardizes quality, minimizes errors, and guarantees business continuity.
Especially in repetitive and time-consuming operations, solutions like CNC automation guarantee production continuity and accuracy. Today, production automation, where robotic systems and intelligent software are integrated, is starting to be preferred not only by large industries but also by SMEs. This explains why automation investment is so much on the agenda.
How is the Return Process Calculated?
Although the return on an automation investment is usually calculated with a classic cost-volume-profit analysis, different variables also play a role in this process. First, the total investment cost, installation time, system operating capacity, and the company’s current operational costs are taken into account.
To explain with a simple example: If a business with a monthly labor cost of 100,000 TL can reduce this cost to 40,000 TL thanks to automation systems, its annual saving will be 720,000 TL. If the investment cost of the system is 1.2 million TL, the investment return period will be 1.66 years, or approximately 20 months. Of course, if other added values such as energy savings, quality increase, and reduction in error rates are included in this calculation, this period can be even shorter.
Furthermore, depreciation calculations also come into play at this point. By taking your depreciation periods into account, you can make long-term plans and support your decisions with the measurable data offered by digitalization.
How Does Labor and Time Saving Reflect on the Return?
Labor saving is perhaps the most significant advantage of automation investment. Producing more with fewer personnel is the most common reason for preferring these systems. At the same time, factors such as the reduction of labor-related errors, the minimization of scrap rates, and the optimization of machine operating hours directly affect the return process.
For example, in a production line working with CNC automation, one operator can supervise multiple machines. This both reduces salary expenses and offers a more efficient working model for the business. At the same time, flexibility in shift systems can be provided, establishing a machine-independent working system. This is directly reflected in the gain obtained through production automation.
Depreciation Periods Vary by Sector
Each sector has a different production structure, needs, and business model. This is another factor affecting the return period of automation investment. For example, the return can be faster in areas with high volume and standard production like the automotive sector, while it might take a little longer in jobs requiring more manual skills like furniture or textile.
Furthermore, elements such as government incentives, tax advantages, and energy support can also shorten depreciation periods. Customizing your investment decisions according to the sector in which your business operates will enable you to achieve maximum efficiency.
Investment Return of Automation with Real Scenarios
With a project carried out by Sora Robotic, the palletizing line automation system in a food factory was modernized. A 3-person technical team and a fully automated system replaced the 12-person shift team. As a result, a 65% reduction in monthly personnel costs was observed, and the system amortized itself in just 14 months.
In another scenario, a company operating in the metal processing sector increased its production capacity by 45% by using CNC automation systems. At the same time, energy consumption decreased by 20%. Such data affect both the investment return period and sustainability and competitiveness.
In conclusion, automation investment provides not only financial return in the long run but also contributes to the company’s digital transformation, increased customer satisfaction, and competitive advantage. Those who invest today will be the winners of tomorrow.