Why buy new machinery?

Packaging cost reduction is the number-one reason that consumer goods companies invest in new packaging machinery. Increasing functionality ranks second. These facts are gleaned from a study, the "2006 Packaging Machinery Purchasing Process Survey," from the Packaging Machinery Manufacturers Institute, released earlier this spring.

The research was conducted to gain an unbiased and objective understanding of the attitudes and behaviors of packaging machinery purchasers. It follows two earlier, similar studies done in 2003 and 2004 in order to provide any possible trend analysis.

Supply-chain improvements and requirements were rated as the second most important reason for buying new equipment by the largest companies—those of more than $5 billion in annual sales—but ranked fifth by other companies. Other important motives for machinery investments include product safety and product-differentiation strategies, enhanced worker ergonomics, packaging volume or weight reduction, tracking and pricing requirements and shelf-life expansion. Last on the list, regardless of company size, but still of importance, is environmental expenditures.

During the past three years, the greatest motivations for purchasing new packaging equipment were new package designs and new process innovations. Looking ahead over the next three years, these reasons still hold importance, but the very large companies rate package design higher than process changes, which are ranked considerably higher among smaller and mid-size firms.