How long does this automation investment take to repay?
Find automation rating and capacity on your Production page, and labour cost per unit on the Production spreadsheet.
What would labour cost be at every automation level?
See the whole ladder at once, with the cost to get to each level and the payback at your current volume. Useful for deciding how far to go rather than whether to go at all.
Should this particular product be automated?
Payback is only half the question. High automation makes a product slow and expensive to reposition, which is fatal for a segment that demands constant revision. This weighs both sides.
How Automation Works in Capsim
Every production line has an automation rating from 1 to 10. Raising it cuts the direct labour cost of every unit that line produces, permanently, for the rest of the simulation. That makes it one of the few decisions with a compounding return — and one of the few that can be made too late to matter.
What it costs
On a standard Capstone setup, raising automation costs around $4.00 for each point of automation, for each unit of capacity on that line. Moving a 1,800-unit line from automation 4 to automation 6 is two points across 1,800 units, so roughly $14,400. The spend appears as a plant improvement on your cash flow statement, not as an expense on your income statement, which is exactly why teams who buy automation out of the cash balance meet Big Al's emergency loan.
What it saves
Labour cost per unit falls as automation rises, by roughly ten per cent of the base cost for each point. The saving applies to every unit you produce, every round, so the payback depends heavily on volume. A high-volume Low End product repays automation quickly. A low-volume niche product may never repay it at all.
The cost nobody budgets for
High automation makes a product slower and more expensive to reposition on the perceptual map. This is the trade-off that decides which products should be automated. A Low End product that barely moves can safely go to 9 or 10. A High End product that must be revised every round to stay near the cutting edge should stay moderate, because an automation-9 High End product cannot keep up with segment drift and loses the segment it was built for. The R&D revision date calculator shows how far that drift actually goes.
Timing
Automation bought in round two earns its saving in every round that follows. The same purchase in round six has two rounds to repay a cost that took four rounds of savings to cover. This calculator asks how many rounds are left for exactly that reason — the right answer in round two is often the wrong answer in round six.
Which Products to Automate
| Segment | Suggested automation | Reasoning |
|---|---|---|
| Low End | 8–10 | Buyers want an old, cheap product. It barely needs repositioning, so there is no penalty and the volume is high. |
| Traditional | 6–8 | Revised every other round, so moderate-to-high automation works. Good volume supports the investment. |
| Size | 5–7 | Needs regular repositioning to track size drift. Keep some flexibility. |
| Performance | 4–6 | Frequent revisions to track performance drift. Too much automation makes those revisions slow. |
| High End | 3–5 | Must stay near the cutting edge every round. Automation here buys cheap labour and loses the segment. |
These are general patterns from standard Capstone runs, not rules. A cost-leadership strategy justifies higher automation across the board; a differentiation strategy justifies less.
Funding the purchase properly
Automation is a long-lived asset that pays back over several rounds, so fund it with long-lived money. Raising bonds in the same round you buy automation keeps your cash balance intact and matches the financing to the asset. Teams that fund automation from cash and then discover their production run was larger than forecast are the ones who end the round with an emergency loan — check the round in the emergency loan estimator before you commit.