Four Strategies to Help Free Up Working Capital on Your Precious Metal Sputtering Targets.
Healthy levels of working capital and free cash flow are critical to growing businesses.
Sputtering targets are essential elements in innovative products from the aerospace, automotive, glass, medical and semiconductor industries. But gold, silver, platinum and palladium sputtering targets are more capital intensive than common targets made from metals like copper or tin. Here are four strategies your precious metal sputtering target manufacturer can employ to help your company preserve working capital.
1. Incorporate spent target recycling into the target manufacturing process.
Approximately half of the metal in a sputtering target will reach the substrate. The other half becomes what’s known as a spent target. If that target is made of gold, silver, platinum or palladium, it’s also spent capital sitting idle in your coater. An efficient spent target recycling program allows you to send the spent target back to the manufacturer, get a quick credit for the remaining precious metal and apply it as a down payment for your new target. Which means less capital up front, a faster turnaround of your new targets, less exposure to volatile metal markets and more free cash flow.
2. Design targets for maximum efficiency during the precious metal sputtering process.
Copper, one of the most commonly used sputtering target materials, trades around $.25/oz today. As we write this, gold is approximately $1,800/oz, palladium near $1,400/oz, platinum close to $900/oz and silver around $20/oz. Which means the least expensive precious metal costs around 80 times more than copper. A custom target that requires less precious metal up front and is thoughtfully designed to put more metal on the substrate can help lower the cost of sputtering target ownership. Over time, a small increase in precious metal sputtering efficiency can result in smaller targets which helps preserve working capital and increase cash flow. An experienced precious metal sputtering target manufacturer will be well versed in design strategies to help lower the costs and amount of metal used in your targets.
3. Consistently meet or exceed time commitments.
Prompt invoicing and accounts payable is key to increasing cash flow in traditional businesses. In the precious metal business, the faster your precious metal can be made into a target that is sputtering in your coater, the sooner you’ll have product to sell and create more cash flow. When manufacturing gold, silver, platinum and palladium sputtering targets, time isn’t just money, it can be a lot of money.
The most experienced precious metal sputter target manufacturers have a culture that makes honoring time commitments a top priority.
4. Avoid stockpiling inventory.
If your sputtering targets are made with inexpensive materials, you can afford to leave them sitting on a shelf waiting to be deployed. Precious metal sputtering targets are not made with inexpensive materials. Leaving thousands or even millions of dollars sitting idle on a shelf is not an option. An experienced precious metal sputtering target manufacturer will also be an expert at managing logistics and creating a production schedule that makes sure targets are always in your coater and rarely on the shelf.
The leading precious metal sputtering target manufacturers have strategies to help your company realize organizational efficiencies and develop best practices that maintain a balance between profitability, growth and liquidity. The people of DHF Technical Products have spent over a century helping companies who use precious metal targets preserve their working capital and increase free cash flow. If you have additional questions about gold, silver, platinum and palladium sputtering targets, let’s talk today.
