Cost Of Ownership

When you purchase a piece of equipment, it is easy to think that the ticket price represents the cost of the equipment. Unfortunately, that is not quite true:

There are many expenses to be considered over the lifetime of the asset, some of which are not immediately obvious at the time of purchase.  So on top of the depreciation charges the following need to be considered by any organisation purchasing test equipment:

  • Maintenance and servicing costs
  • Out of warranty repair costs
  • Calibration costs
  • Down-time to cover either repair, maintenance or calibration
  • Storage costs when not in use
  • Logistics costs of ensuring the equipment is in the right place and the right time with the correct supporting documentation
  • Finance costs: Including either the cost of borrowing or the Internal Rate of Return (IRR) when compared to other possible expenditure
  • Disposal costs at the end of its useful or technical life
  • Insurance costs
  • The cost of keeping up to date with upgrades and / or licensing subscriptions.

And I am sure that you can think of a few more that are relevant to your organisation.

Enter your own data into the above sheet to get figures that relate to you.

So what can you do about it?

Well there are always ways of negotiating some of these aspects to trim these costs and any good purchasing department will tackle this.

The alternative is to rent the equipment; especially when the need is for a defined period of time or the equipment will have a patchy usage over its life. With rental, most of the above costs are included in the rental charge and if you are not using the equipment then you simply return it. Likewise, if you discover that you need a different model or a different specification of the equipment then you swap it out for the right specification for your needs.

To find out more contact Livingston at, complete the form below, or call us on +44 (0) 208 614 4055, and an engineer will call you to discuss your needs.