Gut vs Spreadsheets an Analysis Part II

This is a follow-up to the first part of this blog which you can find here.

I want to start with a couple of omissions from the first article when I mentioned Andrew Carnegie (towards the end). The intent was to communicate that while he is greatly attributed with the rise of the American steel industry he was not a in my opinion an innovator. 

He was an early adopter of technology; in that article it listed several innovations that occurred in the steel industry.

To many it might be surprising as it was to myself, he was not attributed with inventing or innovating on any of them. Instead he merely quickly adopted them. While many of the older people in his industry said they would (a) not work or were (b) a waste of money.

So that's the lenses to view this through. That's personally the perspective I take when doing this. Carnegie created something crazy...granted the noise was less because there were not podcasts and tweets and posts, but that's also why the title of the post includes Gut.

What does our gut and intuition say about this technology and what does our spreadsheet/financial analysis show.

Right now there are (3) main players in the space (a) Rugged Robotics (b) Dusty and (c) HP.

From what I understand Rugged currently does this as a service which for us is not ideal since its someone else to mobilize and manage, so its not going to be considered for this part. Technical features aside Dusty and HP are relatively the same output of lines on a floor, but their pricing model varies.

Fixed Costs

Dusty

For Dusty the equipment is leased so the exact terms may vary with duration, but for a 12 month lease its $3,000 per month, or $36,000 per year whether its used 0 days, 1 day, or all 365 days.

HP

For HP the equipment (i.e. hardware) is purchased which is the robot + total station and this is estimated to be about $80,000 which can be deprecated over time.

What we covered above is the "fixed" cost for both systems. This is something you paying regardless of use. Personally, lease vs. buy comes down to maintenance, replacement, and change of technology and payback timeline. All things that are going to vary by company. In doing my own evaluation I did ask about old hardware buyback programs, and how often are new releases expected (this is hardware not software....so don't expect a new version every 2 weeks).

Usage Costs

Dusty

For dusty the usage cost is $1500 per day for 24 hours. From what is understood the clock does not start right when you turn on the tool. You are given some initial time to set control, check and make sure all systems are running. From my experience with uploading Dusty files for others there is an emulator that will provide a duration of the print, so one can quickly calculate this.

So if we carrying out the math for a full year which has roughly 20 working days per month that is $1500/day x 20 days/month = $30,000 per month or $1500/day x 260 days/year = $390,000.

You would need to check payroll across all jobs to see how many days was layout active to get an idea, but keep in mind that it will take less days to layout than prior.

HP

For HP the usage cost is $0.20/SQ FT, from what I have learned the square footage is calculated in the emulator online, but is reasonably close to the exact floor footprint, but since the emulator is doing the path it may vary some, but not "a lot". The usage fee caps out at $12,000 per month or 60,000 square feet so. If in a month there is 78,056 sq feet of layout. The last 18,056 there is no active usage fee.

So carrying out the math for a year the most this could be is $144,000 (i.e. 12 months/year x $12,000/month).

Humans

In both cases there is one human still required. The labor cost will vary depending on that persons payroll and location, union, non-union and how each company choses to use the tool. Do you put a really stellar layout person with this in case of issues, or do you have a apprentice attend to the robot.

Keep in mind the duration is straight hours so unless you have caffeine onsite the one layout person won't be there for 26 hours straight, but in theory this is something you consider.

So let's say the print will take 26 hours. If one assumes a normal 8 hour working day that print will require 3 full days + a little bit of time on the 4th day.

However, if a company could align crews to run for 26 hours straight with swapping out guys, etc. A floor could be all ready 2-2.5 days in advance and depending on how many floors there are this could assist in schedule compression.

Conclusion

Now that we have broken this down lets take what we have learned in the next post and crunch numbers for both cases across two theoretical projects.