Forklift Purchase Price vs. Total Cost of Ownership
When you are purchasing a new forklift or aerial lift, you obtain competitive quotes, verify specifications and generate a purchase order. For that matter, just about anything we purchase goes through the same process. However, there is much more to purchasing forklifts and other material handling equipment. We have found over the years that often there are variables that can greatly affect the total cost of ownership of anything, be it an automobile, forklift or a giant cargo container.
The price you pay for your piece of equipment, by most accounts, reflects about 10 percent of the total ownership costs of that piece of equipment. This leaves 90 percent of your total costs up in the air. Depending on many variables, you could pay much more or less for the equipment than you needed to. These variables include:
Performance and Reliability of Equipment
Comparing cost per hour to operate can give you a good idea of what competing pieces of equipment will cost you over their useful life. When comparing cost per hour to operate, you should be sure you’re comparing similar models under similar circumstances. A lift truck operating 1500 hours a year for a light weight product manufacturer will cost far less over its lifetime than the same lift truck operating at a recycling facility. This cost should reflect general maintenance requirements as well as fuel costs.
While this is often a part of performance and cost per hour, knowing the fuel costs for each brand and calculating total costs over the life of the equipment can sometimes be quite an eye-opener. In addition, what are your fuel alternatives? Can you use electric models? Thinking outside the box may result in lower costs to power your forklift and other lift equipment.
Specifications vs. Operations
It is rare that two 5,000-lb-capacity forklifts from competing brands will have similar specifications. Knowing what your facility will accommodate and comparing that with each model will give insight into how each model will perform, given your operating parameters. Factors include: aisle width vs. turn radius, draw bar pull, suspension and ergonomics compared to your floor condition, indoor/outdoor use and ceiling height/rack height vs. max lift height. You will also want to compare features between brands to ensure that each lift truck model is equipped with the proper components to meet your operational requirements. For example, can it operate properly inside your ice cream freezer?
A comfortable and smooth-running piece of equipment will provide you with increased productivity. These are costs hidden in equipment that are quite real in daily operating conditions. How much time and research and development, does each brand put into the comfort and ease of use of their equipment? Happy, comfortable operators are simply more productive.
Never underestimate the safety features of your equipment. What equipment is being specified and what equipment is optional from each manufacturer is very important to know. Reducing your accident costs or product/facility damage can make a big difference in your total fleet operational expenses.
Finally, how many hours can you expect from each piece of equipment until the cost to operate becomes cost-prohibitive? This can vary widely depending upon brand and model. But having some qualitative and quantitative information on hand, if possible, will help you make a better decision about the total cost of operating each unit/model.
Find out if you should buy a new or used forklift in our comprehensive new vs. used comparison guide.