If you’re still outsourcing your finishing to a job shop, it can be tough to decide whether or not to bring your powder coating in-house. This is becoming a trend with manufacturers after countless “COVID-related” problems; they’re tired of dealing with logistics problems, shipment delays, high fuel costs, etc. But no matter your reasons, this can be a very tough decision.

A primary reason for bringing coating in-house is to save money and increase profits, plus to add stability to your operation.

As an example of typical powder coating costs, let’s consider a small part that is somewhat complex. Let’s assume it costs $12.00 per part for a single-color powder coat from a local supplier.

Your Outsourced Cost:

• 100 parts x $12.00 = $1,200.00 plus shipping and handling costs

Costs if brought in-house:

• pretreatment chemicals and associated electrical/fuel usage for pretreatment might cost about $40.00.
• The materials and power usage cost for coating a run of 100 small parts might be about $120.00.
• A well-insulated midsize professional batch oven might have a gas/power cost of about $10.00-$15.00 an hour.
• If you dry and cure the parts as 2-3 batches, let’s budget $40.00 to allow for warm-up, drying, and curing.
• Labor might be about $25.00/hour and you could probably prep, dry, coat, and cure the parts in four hours using one operator, so let’s add another $100.00.

Your In-House Cost:

• $40.00 in chemistry/fuel/electricity for pretreatment
• + $120.00 in powder/masking/electricity for coating
• + $40.00 in fuel/electricity for drying and curing
• + $100.00 in labor = $300.00.

This is a rough estimate, of course,  but you can see that the savings can be  significant!

 This example also only considers one batch of small parts. With a larger coating production run, in-house coating becomes even more attractive. By the time you factor in the cost to package, ship out, receive, and inspect the outsourced finishing work on your parts, the savings can be staggering!

When outsourcing, you also have to contend with handling-related damage that can be avoided if the parts never leave your facility.

Most manufacturers mention quality issues as a primary reason for bringing their finishing in-house. Many job shops produce good quality finishes, but they may not meet the tight specifications that you require.

In addition to handling damage, irregular coating thicknesses (especially on complex parts), mismatched color lots, variations in gloss, adhesion problems, and excessive surface defects are all common complaints about outsourced coating work. Rejecting bad parts due to these issues can create costly delays.

For many companies, adding an in-house line is easily worth the investment just to minimize defects.

It’s not uncommon for manufacturers to need an unplanned coating run performed quickly to avoid costly delays. Whether you’re replacing parts that have been fabricated incorrectly or dealing with a parts shortage due to a BOM error, performing your powder coating in-house allows for fast turn-around and can eliminate the costs associated with days of unplanned delays.

Performing coating in-house is also helpful when developing and prototyping designs that you would like to keep private. It lets you experiment with new products, fresh technologies, and improved quality processes that can give your business a competitive advantage.

How do you decide if an in-house coating system is right for you?

When deciding whether to install a new powder coating system in your facility, the main challenge is comparing your costs to see if the benefits are worth the investment. You’ll need to consider the equipment acquisition expense, increased labor costs, and how the learning curve of developing a good finishing process will impact your productivity. Effective training, combined with a period of initial flexibility once your coating system is up and running, will ensure your success.

It’s also important to set realistic goals. Typically, your local powder and chemistry vendors can help you quickly get up to speed with your new equipment. Remember to keep a good relationship with your existing powder coating vendor, since you may need them in the interim or if you temporarily exceed your finishing capacity in the future.

***Here’s the key to help you decide: if you’re already outsourcing a sizable amount of work every month and are concerned about cost, quality, or delivery deadlines – or all three – it’s time to consider bringing your powder coating in-house!

There are numerous finishing equipment manufacturers and suppliers who can assist you with your decision on whether to finally pull the trigger on bringing your powder coating inhouse. One very good one to call is Reliant Finishing Systems.

Others can be found here on PCO: Turnkey Powder Coating Systems

Reliant Finishing Systems  256-355-9000 info@reliantfinishingsystems.com