Tool and die industry profile

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Industry definition

The Tool and Die Industry uses general and specialized metal cutting technology to

fabricate dies, molds, and toolings that are used to convert raw material into a required shape. (1

These are fundamental to durable!goods manufacturing. Tools are used to cut and form metal and

other materials. Dies are metal forms used to shape metal in stamping and forging operations.

"olds, on the other hand, are also used to shape plastics, ceramics, and composite materials.

Tool and die companies are typically small businesses. Tool and die companies are responsible

for manufacturing, distributing, and buying and selling of dies, molds, and toolings for industrial

use.

The products of the tool and die industry are made by mold and die ma#ers using general,

conventional, and specialized metal cutting technology. $omputer numerically controlled ($%$

cutting machines and special tools are employed to steel materials that undergo heat treatment

after the tool has been cut into shape. The industry&s prospects are closely tied to the outloo# for

durable!goods manufacturing as a whole.

The ma'or characteristics of tools, dies, and molds (TD"s are differentiated through its

precision, compleity, and quality. There are TD"s that are more precise than others, according

to its use in the industry. The die or mold must produce accurate part features so that there are no

blemishes or deformations on the finished product.

Truly, the TD" industry is global in scope. %early all of the manufacturing industries

rely on the services and products of TD" ma#ers. )apan is generally considered to be the largest

global producer, followed by the *nited +tates, $hina, and ermany. -sian countries on the

other hand, have sufficiently established their TD" industries and are quic#ly evolving. These

industries have the advantage of obtaining new and state of the art production machinery and

software. In terms of global trade, )apan seems to be the top eporting company largely because

of the substantial number of plants worldwide that rely on )apanese TD"s.

In the hilippines, the government recognizes, supports, and promotes the tool and die

industry as in is an important complement to other manufacturing activities. +ta#eholders li#e the

hilippine Die and "old -ssociation (D"- engages with the government and collaborates

with other industries, such as the "etalwor#ing Industries -ssociation of the hilippines ("I-

(1) Industry.gov.ph tool and die


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and the hilippine "etalcasting -ssociation, Inc. ("-I. $urrently, there are about 1/0 firms in

the tool and die industry which includes some distributors. These firms provide input materials to

#ey manufacturing activities such as die casting and forging, metal stamping, and semiconductor

tooling for the main manufacturing companies of the country.

igure 22.22. hilippine 3port and Import data from years 4000!4014.

The hilippines is also inclined to eporting and importing TD"s because of the rapid

increase the manufacturing and service sector. -n estimate of the amount of eport and import

are shown in the charts above.

Industry participants and market share

The tool and die industry in the hilippines comprises of 1/0 tool and die shops that

manufacture their own TD"s or toolings and a number of distributors or, middle men, that

import the toolings from around the world to distribute to the manufacturers in the hilippines.

The main distributors are comprised of 5 companies, not including the /0 and more small firms

that also distribute imported TD"s to automobile manufacturers, mold ma#ers, and etc. Total

local demand for TD"s is estimated to be about 657 "illion. This quantity for the domestic

mar#et is relatively small compared to other countries.

The primary competitors in the distributorship of toolings in the hilippines are +andvi#,

+hime Trading Inc., +eco Tools hilippines, and 8+ hilippines. +andvi#, +eco, and 8+, are

all global brands that only have branches in the hilippines. The only hilippine based company

that distributes toolings to manufacturers is +hime Trading Inc.



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Sandvik

+andvi# is a global company founded by oran redri# oransson in 19:4 in +andvi#en,

+weden. It is an engineering group in tools and tooling systems for metal cutting, mining, and

products in stainless steels and alloys. +andvi# has a branches in the hilippines for mining and

construction equipment and manufacturing tools.

Seco Tools

+eco Tools is another leading manufacturer and supplier of carbide cutting tools and

associated equipment. The company was also found in +weden. The distribution in the

hilippines is only second to their distribution in "alaysia and +ingapore in -sia.

OSG Corporation

8+ $orporation is a comprehensive cutting tool, rolling dies, gauges, machine tools and

machine parts manufacturer import and sales of tools. Its main operations are located in )apan.

They distribute their own products in the hilippines, mostly in ;aguna where it is based.

Industry Appraisal

Strengths

Ta and duty eemption given on imported TD" parts.

+#ills and competence of tool < die engineers, technicians, and specialists.

Investing in manufacturing in the hilippines is easier due to 3+;.

+trong economic support from government li#e 3=- and ;I;I.

Weaknesses

The hilippines is not yet well #nown around the world as a metal producing and machining

country.



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>igh costs of inputs. i.e. raw materials, cost of production, and molds

*navailability of raw materials in the hilippines.

oor infrastructure. i.e. roads, overpasses, etc.

Opportunities

$onsumer goods mar#et in the hilippines is attractive.

Development of products for local and global mar#et.

rowing foreign investments.

-vailability of the latest technology for production of TD"s.

Threats

$heap imported products from $hina.

Increasing TD" production in nearby countries such as ?ietnam.

Dependency on foreign investors.

rocurement is decided by the company&s principals outside of the country. i.e. in +weden or

)apan.



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RRS related studies

urchasing and distribution systems are mainly concerned on the supply of the product.

The ability to establish and sustain relationships with suppliers is a #ey to success for the

management of a company. -n empirical study by >alli#as < ;intu#angas (401: showed that

the highest correlation with supply ris# performance was supplier orientation. +upplier

orientation is defined as the collaboration with suppliers. This includes error handling, common

goals, and relationship and process development. +uppliers should wor# hand in hand with their

customers to complete a delivery. This includes thorough processing and receiving of

information from each end.

The relationship and relay of information of the supplier to the customer is not the only

factor that this study considers. It also considers the distribution of goods to each of its

customers. +ome are located within "etro "anila and some in the nearby provinces. The recent

renovations by D@> and road rerouting made it difficult for the deliveries to get to the

customer on time. oor roads and infrastructures also contribute to late deliveries. $onstant

development of the area by its spatial city epansion, increase in population density, and a

growing number of production plants and public institutions, requires the government to properly

monitor and manage the situation (Ai'ews#a < Iwan, 401:. Because of this, the company incurs

late invoices. ;ate invoices can lead to the diminishing of customers.

The efficiency of the distribution system is dependent of the total resources used.

$hanges in the system are generally independent of each other. This ma#es the system highly

comple with many factors and decisions to be managed properly (Dubois < >ulthen, 4015.

This is a cause that resorted to digital planning and routing. The digital method saves distance,

time, and the number of vehicles ("oen, 401:. The system that is focused on this study already

uses a digital system but only for its 3C system. -lthough digital planning presents itself as a

solution, the traffic in and around "etro "anila is still uncertain at times. +ome allowances must

still be employed to the delivery time.



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J. Hallikas, K. Lintukangas / Int. J. Production cono!ics 1"1 (#$1%) &'"&&

Kinga Ki*e+ska and tanis-a+ I+an / ransportation esearch Procedia 1# ( #$1% )

"0 "&

u2ois, . 3 Hulth4n, K. (#$1&). ransport as a loosely coupled syste!5 I!plications

6or research andpractice7. Paper presented at the 8ational 9on6erence in ransport

esearch, #1:## ;cto2er #$1&. 8orrk

Documents

Tool and die industry profile