why it is difficult to make money in widely used plastic mold industry

The reason why it is difficult to make money in the widely used plastic mold industry

With the continuous advancement of processing technology and production equipment, plastic molds have begun to use plastic materials as raw materials. These thermoplastic/thermosetting plastic products undergo different production and processing techniques, such as hollow molding, etc., and are increasingly used in various fields of production and life. Plastic molds are widely used in various industries, such as light industrial machinery, agriculture and forestry transportation, etc.

In the field of light industrial machinery, plastic molds are widely used to manufacture various plastic products, such as home appliance casings, auto parts, toys, etc. Because plastic materials are lightweight, corrosion-resistant, and easy to process, plastic molds can achieve higher production efficiency and lower costs during the manufacturing process. In addition, plastic molds can also be customized according to product needs to meet the special needs of different industries.

In the field of agricultural and forestry transportation, plastic molds also play an important role. For example, plastic molds can be used to manufacture parts for agricultural machinery, such as tractor seats, dashboards, etc., as well as parts for forestry transportation tools, such as pallets, containers, etc. These plastic products not only have good wear resistance and impact resistance, but are also lightweight and easy to carry and install. In addition, plastic molds can be customized according to the special needs of agriculture and forestry, improving the practicality and durability of the product.

In short, with the advancement of processing technology and production equipment, plastic molds have been widely used in various industries. Plastic molds can not only improve production efficiency and reduce costs, but also meet the special needs of different industries. In the future development, plastic molds will continue to play an important role and provide strong support for the production and development of various industries.

1、 The domestic production and demand contradiction of high-grade plastic mold products is prominent

Due to the large gap between China’s molds and the world’s advanced level in terms of quantity, quality and technical capacity, the products are mainly concentrated in the middle and low-end mold market, making the import volume of mold products required by China continue to grow in recent years. Although China’s mold industry has maintained a favorable balance of import and export on the whole, the large-scale, precise, complex and long-lived high-end mold products required by China still need to be imported every year, which has caused certain adverse effects on the long-term development of China’s automobile, home appliances and other host industries.

2、 The average sales volume of mould manufacturing enterprises is low

The mold industry does not belong to the standardization industry. The essence of the mold lies in the rationality of the design idea and mold structure. It is an industry with high innovation, high technology content, high precision and high added value. Mold is a highly personalized customized product, and different molds have obvious differences. Therefore, the mold is mainly customized. Moreover, the mold can have a long service life, and a set of molds can produce hundreds of thousands of plastic products.

Therefore, the downstream manufacturing enterprises have less demand for mold products, resulting in lower sales of mold enterprises. According to the data of China Die&Mold Industry Association, in 2011, there were about 20000 die&mold manufacturing enterprises (factories and sites) in China. Based on the total sales volume of the die&mold industry in 2011, which was about 56 billion yuan, the average annual average sales volume of enterprises in the industry was not more than 3 million yuan, the average production capacity was small, and the industry concentration was not high.

3、 There is still a big gap between the technical level of plastic mold industry and that of developed countries

In recent years, the mold industry in China has gradually transited from the extensive workshop operation with fitters as the core to the intensive modern operation with technology as the support and design as the center, and the technical level of the industry has improved significantly.

4、 Customized production mode with obvious product differentiation

The mold is a special process equipment, and each set of products is designed for a specific plastic product. When accepting orders each time, mold manufacturers need to design and manufacture according to the technical data provided by customers. That is to say, most molds are unique, with obvious differentiation characteristics and high requirements for technical level, which is typical single piece customization production.

5、 High regional concentration

The development of the mold industry requires a certain amount of upstream and downstream industrial support, especially the close connection with downstream manufacturing. Mold products are intermediate products, and the main customers are end product manufacturers of downstream manufacturing industry.
Therefore, China’s mold enterprises are mainly distributed in the Yangtze River Delta, Pearl River Delta and other developed manufacturing regions, among which the mold industry in Guangdong, Shanghai, Jiangsu, Zhejiang, Shandong and other provinces and cities is relatively developed, accounting for most of the output value of China’s mold industry.

The plastic mold industry is a widely used and essential part of the manufacturing sector. It involves the production of molds and tools used to shape plastic products of different shapes, sizes, and complexity. Despite its importance, it can be challenging to make money in the plastic mold industry due to several reasons. Here are some of the reasons why it is difficult to make money in the plastic mold industry:

  1. High competition: The plastic mold industry is highly competitive, with many manufacturers offering similar services. This competition drives down prices and makes it challenging for businesses to generate a healthy profit margin.
  2. High cost of materials and equipment: The cost of materials and equipment used in plastic mold manufacturing is significant, making it challenging to maintain profitability. High-quality materials and advanced equipment are necessary to produce high-quality molds, but the cost of these resources can be prohibitive.
  3. Short product life cycle: The product life cycle in the plastic mold industry is relatively short. The molds and tools produced today may not be relevant or in demand in a year or two, making it difficult to maintain a steady stream of revenue.
  4. Long lead times: The production of plastic molds can take a long time, with lead times of several weeks or even months. This can result in missed opportunities and lost business.
  5. High labor costs: The skilled labor required in the plastic mold industry can be expensive. Skilled technicians, engineers, and designers are essential to produce high-quality molds, but their salaries can be a significant expense.
  6. Quality control issues: Quality control is critical in the plastic mold industry. Even a small defect or error in the mold can lead to significant problems in the final product. Ensuring quality control throughout the manufacturing process can be expensive and time-consuming.

In conclusion, the plastic mold industry is an important part of the manufacturing sector, but it can be challenging to make money due to high competition, high costs of materials and equipment, short product life cycles, long lead times, high labor costs, and quality control issues. However, businesses that can navigate these challenges and provide high-quality products and services can still succeed in the industry.