Mold Builders Pages 7 to 12 Twelve Steps to Make the Right Investment Decisions By Charles Daniels Every business must make periodic investments to stay competitive. Investments include new equipment, software, workforce and real estate, which can be an exciting and potentially anxiety-provoking process. While appropriate investment can dramatically improve a company’s success, the outcome could be undesirable if you do not follow a thorough process, because money and time are in limited supply. Before you do anything, organize a diverse group of people who consider all the necessary factors to make these crucial investment decisions. Members of this group should repre-sent purchasing, finance and operations at a minimum. • The first step is always to understand the question of why . For example, identity the problem the company is facing or the opportunities that necessitate this investment. • Determine if methods such as training or process changes could improve the situation without significant investment. In most cases, no amount of investment on its own is a sil-ver bullet to solve issues. • Create a list of potential solutions after you determine the required financial outlay. • Compare and grade all options based on what is essential to the business. For example, primary costs, secondary costs (training, rigging, energy, service/maintenance), timeframe for full adoption, workforce needs, space requirements. • Research and compare vendors for each option regarding delivery, service and support. • Calculate an estimated return on investment (ROI) and timeline of this return after you have tallied all the costs. You can do these calculations several ways, so it is wise to seek assistance from a financial professional, especially for larger purchases. • Consider funding sources and available grants, as different projects may qualify for preferential rates or special grant programs. • The decision team should weigh the items (costs, delivery, ability to solve problems, etc.) to measure each grade suf-ficiently. This method will yield an overall score for each option, making it easier to compare solutions that may not be similar. • Once the decision team tallies the scores, they can focus on the top choice(s) and perform further due diligence, includ-Wepco Plastics President David Parmelee and his leadership team provide a budget and a deadline for each investment decision and then let the rest of the team take on the remaining responsibility. ing financing, vendor presentations and visits to customers currently using the solution. • If the purchase is related to new technology, check out local universities or nonprofits to provide valuable insight and the potential to test the solution. • Once the decision team makes the final choice, the group should present the recommendation to senior leadership. This presentation should be concise and employ data to share why the team selected this solution. Even if the deci-sion group comprises primarily senior leadership and own-ership, developing this presentation will help the group validate the decision. This presentation is also an excellent tool for explaining the investment to the broader team and strengthening grant applications or other financing options. • The final step before the actual purchase is setting up metrics and a timeline — from submitting the purchase order to implementing and tracking. Remember to track the actual progress and metrics versus a forecasted time-line and desired results to ensure the project’s success and improve your investment process in the future. By creating a solid process, following that process and improving it along the way, you’ve already made a terrific investment for your business. FOR MORE INFORMATION Wepco Plastics Inc. / 860-349-3407 / wepcoplastics.com Charles Daniels, CFO, Wepco Plastics 12 MoldMaking Technology — — JULY 2022 Image courtesy of Wepco Plastics.