Have you ever wondered why some welding companies are always making money while others cannot? How about orbital welding system compared to manual TIG welding, does it make any business sense in current competitive environment for high purity piping installation?
Figure 1 shows activities in a typical TIG (GTAW) pipe / tube welding. There is a scale to consider in these activities and it has to be balanced. Take a good look at figure 1 below and consider where your welder uses most of his resources.
Figure 1: When arc is on and wire is being burned to make quality welds your business is making money.
Remember, not all jobs or contracts pay by the hour. (Source from Canadian Fabricating & Welding)
Figure 2 show % time spent by a manual welder in a TIG welding job. You can see that only a small pie of 25% is actually spent on making the welds for a job that does not pay by the hour.
Figure 2: % Time spent on a welding job using Manual TIG welding
Let’s assume a welding services company is paying $30 an hour to their skilled TIG welder, the expected revenue output value generated from the high purity stainless steel tube welding work to his business is $300 an hour. If the company employ 5 welders working 200 days a year and 10 hours a day, this will cost $330,000 per year on salary. Based on industry average of 25% arc time for each manual TIG welder, the revenue output value is $825,000 ($300 x 10 hours x 220 days x 5 welders x 25%) with a profit of $495,000 before deducting the cost for welding gas, consumables, equipment and other overheads.
Figure 3 show % time spent by orbital welding operator on a typical welding job for high purity stainless tube or pipe installation.
Figure 3: % Time spent on a welding job using Orbital Welding System
Due to advance functions in orbital welding system, many of the manual tasks can now be automated and thus freeing up the welder for welding job which results in increase of arc time to 53%. Moreover, an orbital welding system does not require a certified and skilled welder to operate the machine. All it needs is a semi-skilled weld technician with $15 an hour salary and providing them with orbital welding training, usually takes about a week on machine operation and some basic weld training. Assuming with similar output value of $300 per hour, the revenue generated is now doubled to $1.65M and profit tripled to $1.5M. This is more than sufficient to pay for an investment return within a year for 5 sets of orbital welding system. Depend on type of pipe size, an orbital welding machine system will cost anywhere between $35K to 50K.
This simple math concept is underused by many companies when it comes to understanding how to justify new skilled-trades positions by incorporating more advance orbital welding system into their pipe welding business.