How Do You Measure Up?

"Benchmarking" is in vogue these days, as companies look anxiously over their shoulder at the competition and wonder how they compare in quality, efficiency, and profitability. Plastics processors have a brand-new gold mine of benchmarking data to dig through—SPI's 42nd Financial and Operating Ratios survey of plastics processing companies. The 60-page report analyzes statistics from 93 companies and 120 plants, 78% of them custom processors and 58% of them injection molders, 8% extruders, 11% thermoformers, and 25% "all other."

This looks like a challenging group to compare yourself with. Their average on-time delivery in 2003 was 95.1%, and the top 10% were 99.9% on time. Percentage of customer complaints for orders shipped averaged 2.5%, while the top 10% reported zero complaints. Percentage of product poundage that did not meet customer specs was 1.2% on average and, again, zero for the top 10% of respondents. Percentage of employee absenteeism? Just 3.5% on average, and for the top 10%—you guessed it—zero. How did these plants do last year? While 28% of them registered flat or lower sales than in 2002, 37% scored at least double-digit sales gains. And the top 10% of these plants reported double-digit net profit after taxes. Seventy percent of these plants, and 90% of the injection molders, are ISO 9000 certified.

If you're into accounting figures, you'll learn a lot more from the income statement and other statistical data. You might find it interesting to compare different processes in terms of labor and materials costs, labor productivity, value added, total production cost/lb, inventory turns, machine uptime, and other parameters. Thermoformers came out on top in some surprising categories: More of them exported products, operated overseas joint ventures, or received R&D tax credits than either injection molders or extruders.

You can get a copy of the report (#BA-171) from SPI by calling (800) 541-0736. It costs $150 for SPI members, $300 for non-members.