Page 64 - IEC Insights Sept-Oct21

FEATURE

CALCULATING A
Acquiring the right tools and
equipment, plus keeping them

TOTAL in good working condition,
can be a costly undertaking.
The most significant capital
expense for any project
COST OF is typically equipment, so

contractors are tasked
with balancing equipment
OWNERSHIP costs and generating
the highest possible

TO MAKE return on investment.
Calculating the total cost of ownership
(TC0) for each tool or piece of equipment is
DATA-DRIVEN a good place to start. Decisions like which
brands to purchase, buying new or used,
and when to rent vs. buy become easier to
make when there’s data to back them up.
DECISIONS Some equipment managers may assume

that owning makes more business sense
than renting. However, visibility into
TCO can offer some insight into how
BY CHRISTINA ANDREWS, much money an asset may cost for the
UNITED RENTALS project. The TCO calculations include
line items that may often be overlooked,
like ongoing maintenance of the asset or
transportation and storage.

While it is an effective tool, calculating
TCO isn’t always an easy task, primarily
because it includes maintenance and
operation costs which can vary widely.
Lean on historical data to help frame that
portion of the equation and provide some
realistic insight into actual costs.
The good news is, digital tools can help.
Cloud-based fleet management software
coupled with equipment telematics
data can provide some clear visibility
into owning and operating costs and
maintaining a specific asset. Tapping into
the tools and insights of modern fleet
management solutions could save even
more time and money during the process.

62 Insights Magazine | September/October 2021 | www.ieci.org