How to Calculate ROI (Return on Investment)

You may have asked…why should I switch over to an engineered compressed air product if my system already works? Or…How can your products be much different?

Manufacturing has always been an advocate for cost savings, where they even have job positions solely focused on cost savings. Return on Investment (ROI) is a metric they look toward to help make good decisions for cost savings.  The term is used to determine the financial benefits associated with the use of more efficient products or processes compared to what you are currently using. This is like looking at your homes heating costs and then changing out to energy efficient windows and better insulation. The upfront cost might be high but the amount of money you will save over time is worth it.

ROI Calculation

How is ROI calculated? It is very simple to calculate out the potential savings of using an EXAIR Intelligent Compressed Air® Product. We have easy to use calculators on our websites Resources where filling in a few blanks will result in an ROI when switching to a EXAIR product! Here they Are, Calculators.

I’ll go ahead and break down the simple ROI calculations for replacing open blow offs with an EXAIR Super Air Nozzle:

  • ¼” Copper Pipe consumes 33 SCFM at 80 psig (denoted below as CP)
  • A Model 1100 ¼” Super Air Nozzle can be used to replace and only uses 14 SCFM at 80 psig (denoted below as EP)

Calculation:

(CP air consumption) * (60 min/hr) * (8 hr/day) * (5 days/week) * (52 weeks/year) = SCF used per year for Copper Pipe  

(33) * (60) * (8) * (5) * (52) = 4,118,400 SCF

(EP air consumption) * (60 min/hr) * (8 hr/day) * (5 days/week) * (52 weeks/year) = SCF used per year for EXAIR Product  

               (14) * (60) * (8) * (5) * (52) = 1,747,200 SCF

Air Savings:

SCF used per year for Copper Pipe – SCF used per year for EXAIR Product = SCF Savings

               4,118,400 SCF – 1,747,200 SCF = 2,371,200 SCF in savings

If you know the facilities cost to generate 1,000 SCF of compressed air you can calculate out how much this will save. If not, you can use $0.25 to generate 1,000 SCF which is the value used by the U.S. Department of Energy to estimate costs.

Yearly Savings:

                (SCF Saved) * (Cost / 1000 SCF) = Yearly Savings

                                (2,371,200 SCF) * ($0.25 / 1000 SCF) = $592.80 annual Savings

With the simple investment of $42 (as of date published) you can calculate out the time it will take to pay off the unit.

Time Until payoff:

                (Yearly Savings) / (5 days/week * 52 weeks/year) = Daily Savings

                                ($592.80/year) / (5 days/week * 52 weeks/year) = $2.28 per day

                (Cost of EXAIR Unit) / (Daily Savings) = Days until product has been paid off

                                ($42) / ($2.28/day) = 17.9 days  

As you can see it doesn’t have to take long for the nozzle to pay for itself, and then continue to contribute toward your bottom line. 

If you have any questions about compressed air systems or want more information on any of EXAIR’s products, give us a call, we have a team of Application Engineers ready to answer your questions and recommend a solution for your applications.

Jordan Shouse
Application Engineer

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Hand Holding money Image from Pictures of Money Creative Commons license

Engineered Compressed Air Products = Less Noise & Money Saved

Everyone dislikes loud noises for the most part. Here in Ohio we just got done surviving the constant buzz and swarming of cicadas. We all deal with noise on a daily basis, some of it enjoyable and some of it not so much. Noise is an inescapable fact of life and all we can do is try to reduce noise level to save our sanity. But, did you know that cutting down on the noise produced by compressed air blow offs can actually save you money? Your loud homemade blow off system is not only way too loud, but it is most likely also costing you more money than you need to spend.

EXAIR’s engineered compressed air products are designed to operate quietly and efficiently. The reduction in noise they produce is only one of the benefits – another is the reduction in money by reducing compressed air use.

EXAIR Super Air Knife Promotion
EXAIR’s SUPER AIR KNIFE

But how does one calculate out the ROI? It is very simple to calculate out your potential savings of using one of EXAIR’s Intelligent Engineered Compressed Air Products. If you would rather not do the calculations out yourself then we can do it for you by sending the item in question to our Efficiency Lab Testing. The Efficiency Lab Testing is a free service that we offer to show you the possible savings by switching to one of our products.

The following is a typical ROI preformed and replaced with a corresponding EXAIR Super Air Nozzle:

  • ¼” drilled pipe with (3) 3/32” Holes which uses 9.4 SCFM per hole at 80 psig (denoted as DP)
  • A Model 110003 3” Super Air Knife can be used to replace and only uses 8.7 SCFM at 80 psig (denoted below as SAK)

Calculation:

(DP air consumption) * (60 min/hr) * (8 hr/day) * (5 days/week) * (52 weeks/year) = SCF used per year for Copper Pipe 

(28.2) * (60) * (8) * (5) * (52) = 3,519,360 SCF

(SAK air consumption) * (60 min/hr) * (8 hr/day) * (5 days/week) * (52 weeks/year) = SCF used per year for EXAIR Product 

 (8.7) * (60) * (8) * (5) * (52) = 1,085,760 SCF

Air Savings:

SCF used per year for DP – SCF used per year for SAK = SCF Savings

               3,519,360 SCF – 1,085,760 SCF = 2,433,600 SCF in savings

If you know the facilities cost to generate 1,000 SCF of compressed air you can calculate out how much this will cost you would save. If not, you can us $0.25 to generate 1,000 SCF which is the value used by the U.S. Department of Energy to estimate costs.

Yearly Savings:

                (SCF Saved) * (Cost / 1000 SCF) = Yearly Savings

                                (2,433,600 SCF) * ($0.25 */ 1000 SCF) = $608.40 annual Savings

With the simple investment of $216 (as of date published) you can calculate out the time it will take to pay off the unit.

Time Until payoff:

                (Yearly Savings) / (5 days/week * 52 weeks/year) = Daily Savings

                                ($608.40/year) / (5 days/week * 52 weeks/year) = $2.34 per day

                (Cost of EXAIR Unit) / (Daily Savings) = Days until unit has been paid off

                                ($216) / ($2.34/day) = 92.3 days 

As you can see it doesn’t take long for the air knife to pay for itself. You also get better overall performance as the Super Air Knife will provide a solid curtain of air. In the end you get to breathe a sigh of relief as no more jump scares and a loud hiss when you turn your air on. Who doesn’t like to save a little money and sanity, especially in these crazy times?

If you have any questions or want more information on EXAIR’s Air Knifes or like products. Give us a call, we have a team of application engineers ready to answer your questions and recommend a solution for your applications.

Cody Biehle
Application Engineer
EXAIR Corporation
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The Impressive ROI of an Engineered Air Nozzle

You may have asked…why should I switch over to an engineered air nozzle if my system already works? Or…How can air nozzles be much different?

Manufacturing has always been an advocate for cost savings, where they even have job positions solely focused on cost savings. Return on Investment (ROI) is a metric they look toward to help make good decisions for cost savings.  The term is used to determine the financial benefits associated with the use of more efficient products or processes compared to what you are currently using. This is like looking at your homes heating costs and then changing out to energy efficient windows and better insulation. The upfront cost might be high but the amount of money you will save over time is worth it.

Model 1100 Super Air Nozzles can save compressed air dollars and increase safety

But how is ROI calculated? It is very simple to calculate out your potential savings of using one of EXAIR’s Intelligent Engineered Compressed Air Products. If you would rather not do the calculations out yourself then we can do it for you by sending the item in question to our Efficiency Lab Testing. The Efficiency Lab Testing is a free service that we offer to show you the possible savings by switching to one of our products.

The following is a simple ROI  calculation for replacing open blowoffs with an EXAIR Super Air Nozzle:

  • ¼” Copper Pipe consumes 33 SCFM at 80 psig (denoted below as CP)
  • A Model 1100 ¼” Super Air Nozzle can be used to replace and only uses 14 SCFM at 80 psig (denoted below as EP)

Calculation:

(CP air consumption) * (60 min/hr) * (8 hr/day) * (5 days/week) * (52 weeks/year) = SCF used per year for Copper Pipe  

(33) * (60) * (8) * (5) * (52) = 4,118,400 SCF

(EP air consumption) * (60 min/hr) * (8 hr/day) * (5 days/week) * (52 weeks/year) = SCF used per year for EXAIR Product  

               (14) * (60) * (8) * (5) * (52) = 1,747,200 SCF

Air Savings:

SCF used per year for Copper Pipe – SCF used per year for EXAIR Product = SCF Savings

               4,118,400 SCF – 1,747,200 SCF = 2,371,200 SCF in savings

If you know the facilities cost to generate 1,000 SCF of compressed air you can calculate out how much this will cost you would save. If not, you can us $0.25 to generate 1,000 SCF which is the value used by the U.S. Department of Energy to estimate costs.

Yearly Savings:

                (SCF Saved) * (Cost / 1000 SCF) = Yearly Savings

                                (2,371,200 SCF) * ($0.25 / 1000 SCF) = $592.80 annual Savings

With the simple investment of $42 (as of date published) you can calculate out the time it will take to pay off the unit.

Time Until payoff:

                (Yearly Savings) / (5 days/week * 52 weeks/year) = Daily Savings

                                ($592.80/year) / (5 days/week * 52 weeks/year) = $2.28 per day

                (Cost of EXAIR Unit) / (Daily Savings) = Days until product has been paid off

                                ($42) / ($2.28/day) = 17.9 days  

As you can see it doesn’t have to take long for the nozzle to pay for itself, and then continue to contribute toward your bottom line. 

If you have any questions about compressed air systems or want more information on any of EXAIR’s products, give us a call, we have a team of Application Engineers ready to answer your questions and recommend a solution for your applications.

Cody Biehle
Application Engineer
EXAIR Corporation
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Follow me on Twitter
Like us on Facebook

Back To The Basics: Process Improvement Basics

We understand that it is more important than ever to realize savings within manufacturing processes. EXAIR can reduce compressed air consumption and provide simple ROI in a matter of weeks in MANY cases.

In the hustle and bustle of the daily grind wherever you are, there are certain processes that become muscle memory for you and certain processes that just work and don’t need any attention. Whether it be a login process for your computer network, the number of steps it takes to fill your coffee cup, or the compressed air applications in your facility.

You know what I am talking about, these items begin to get glanced over and often become overlooked. When going through process improvements or troubleshooting, it is easy to overlook processes which are not causing trouble or that have become “acceptable” because they are producing. EXAIR firmly believes compressed air applications are ripe for improvement, and our product lines are built to replace inefficient compressed air products with engineered and efficient solutions.

When evaluating a process for improvement creating a baseline is the necessary start. With this, we can then start to draw a realistic target of where the process needs to be in order to be optimized and document the changes from our starting baseline.

Much like the 6 Steps to Compressed Air Optimization, which starts with measuring compressed air consumption to provide a baseline.  Sometimes, this may require the installation of a Digital Flowmeter, others it may include taking advantage of our Efficiency Lab service for us to get a baseline of what air consumption and other key performance indicators are for your application.

Looking to “go green?” We can help.

Once we have the baseline and a target, we can then begin to design an improvement process. Whether this is implementing better controls for the air, such as pressure regulators, or implementing controllers such as the Electronic Flow Control, it may even be simply installing an engineered solution.  Once an improvement has been implemented we can then go on to the next testing phase to again gather data to see how much air was saved from the baseline.

EXAIR’s Free Efficiency Lab

Once the performance of the new process is determined then we can take the new cost of ownership numbers and give a simple return on investment back to determine what the actual savings by implementing these process improvements have amounted to.

The below example is from a customer who had already improved their static elimination application by using our Super Ion Air Knife instead of a homemade pipe with drilled holes. They further optimized the application with our Electronic Flow Control.

If you would like to talk through methods for process improvement or how we can help you determine these costs, please reach out.

Brian Farno
Application Engineer
BrianFarno@EXAIR.com
@EXAIR_BF