What is Total Cost of Ownership (TCO)? How does it apply when purchasing a water treatment plant or wastewater treatment plant?
Total Cost of Ownership (TCO) is a concept that is essential for any business looking to implement new equipment, processes or systems. In the context of water treatment, it is particularly relevant to large, water-intensive food processing companies that need to manage their water resources effectively. In this blog post, we will explore what TCO is and why it matters for water treatment solutions.
According to a report by the Australian Industry Group, water prices for large users increased by 57% between 2012 and 2017, and the trend is expected to continue. As such, food processing companies need to consider the long-term costs of their water treatment solutions, not just the initial purchase price. This is where TCO comes into play.
TCO is a comprehensive view of the costs associated with owning, operating and maintaining a piece of equipment or system over its entire lifecycle. It includes the initial purchase price, installation costs, ongoing maintenance and repair costs, energy consumption and water usage costs, as well as disposal or replacement costs at the end of the equipment's life.
A useful formula to calculate TCO is:
TCO = purchase price + installation costs + operating costs + maintenance and repair costs + disposal/replacement costs
By taking a TCO approach, food processing companies can make more informed decisions about their water treatment solutions, considering not only the upfront costs but also the ongoing costs throughout the equipment's life. For instance, by investing in high-quality, efficient equipment such as Waterform's biological nutrient reduction (BNR) wastewater treatment systems, food processing companies can reduce their water and energy usage, as well as maintenance and repair costs, leading to significant long-term cost savings.
By partnering with Waterform, our customers benefit from our experience and expertise in the design, installation and ongoing maintenance of water treatment solutions. We take a TCO approach to ensure that our customers receive the most cost-effective solution for their needs.
Total Cost of Ownership is a crucial concept for any business looking to invest in new equipment or systems, including water treatment solutions.
By considering all the costs associated with owning, operating and maintaining equipment over its entire lifecycle, food processing companies can make more informed decisions that lead to significant long-term cost savings.
With Waterform's expertise and focus on cost-effectiveness, they can ensure that they have a water treatment solution that meets their needs and budget.