A question that comes to mind is why would a machine builder not give away the machine and get a royalty on each product made off their machine?
If we're still talking about sewing, the short answer is pretty simple. The industry is conservative. When a shop or factory buys a sewing machine (or loom, or cutter, or whatever) they buy it outright. No hour meters, no operation counters, and no auditor coming by to read the meter and figure out the monthly charges. Just like metalworking tools, there are lots of 25-50 year old sewing machines still going strong.
Would you buy a machining center or a screw machine if you had to pay not only the lease on the machine, but a usage fee? What kind of outrageous improvement (over your competition) in productivity would that machine have to provide to justify the direct increase in cost? (Not to mention the intrusion into your business operations.)
If you're the machinery maker, how are you going to get the usage numbers? Require the machine to be hooked up to the internet or a telephone line periodically to operate? Not a chance of that happening. Send auditors out to China, Thailand, Columbia, Mexico and the occasional US location to read the meters? Probably not very economic. Have your local dealers or sales reps do the job? They might do it, if they got paid to do it. And once you get your usage numbers, how are you going to collect your royalties?
In the office machinery world (think big copiers), it was not unusual to have to pay usage charges in addition to the upfront machine price. There were three reasons for that. First, it gave the sales forces of Xerox, IBM and their competitors a gimmick to battle their way in the customer's door by lowering the nominal machine price; second, most customers leased the equipment and did not buy it outright, and third, it raised revenue to compensate for a fairly expensive service organization. Industries that make outright sales and have less, shall we say, aggressive sales forces and ubitquitous services forces generally don't play such games with pricing.
Surley as a company they could make a hell of a lot more money running the machines versus building them.
There is just
so much more to running a successful sewn products business than having a fleet of high-volume machines. Why didn't Brown&Sharpe get rich making automobiles? Pratt&Whitney did make aircraft engines, but the P&W aircraft and machine tool businesses were distinct businesses.
First off, what would such a super-automation company produce? Their own product? So, in addition to doing automation and mechanical design they now have to be fashion designers? They have to market and sell garments, bags and other sewn products rather than fancy machines?
Well, in fact most factories and cut-make-trim shops don't make their own product. Manufacturers (the designers who own the product intellectual property and market and sell the goods) contract with factories and CMT shops to have the product made. But
nobody contracts with a shop full of automatic machines. There is a wide range of services specific to sewn products, like sample making, production pattern making, local material sourcing, logistics integration, EDI order and production integration, etc., etc., etc.
Having a factory full of machines, even with operators standing by to feed and care for them, does nothing for these critical services. The only manufacturers who would go to such a factory are looking for the absolute lowest cost production, and manage all the other services themselves. But for the price of
one $500K fancy-schmacy super-automated machine, I can buy outright 300 conventional sewing machines and feed the third-world operators needed to run them for a year.
So the short answer is: It's a totally different business and being good at making machinery is no help at being good at making sewn products. The slightly longer answer is: Reducing production costs through automation isn't sufficient. You are too expensive to win the race to the bottom of naked production costs, and you don't provide any of the services required of a value-added factory or CMT shop.
Disclosure: I write the occasional technical article for
Fashion-Incubator.
