Are you relying on purchase price alone to make decisions? Consider life-cycle costing instead. It takes maintenance, repair and fuel expenses into consideration, as well as trade-in and resale value. Endorsed by the National Institute of Governmental Purchasing (NIGP), the National Association of State Procurement Officials (NASPO) and other associations, it’s a simple calculation that lets you compare options from a total cost perspective.
Initial Purchase Price - Trade-in + Maintenance + Repairs + Fuel - Resale Value = Life Cycle Cost
This calculation can be customized to include other factors such as productivity, uptime and downtime. The more factors you include, the more confident you can be in the evaluation process.
Get the details on how to bring a total cost approach to procurement to your agency.