Reducing the cost of ownership on your equipment fleet

February 27, 2017

The majority of businesses out there are actively working to push their equipment costs down, with many companies focusing on the cost of owning and operating equipment. With new technology on the rise, and some manufacturers finding ways to extend service intervals, it may be worth exploring some of the options that are now available for equipment hire and purchases in Western Australia.

10 Tips for lowering your equipment’s whole of life costs

1. There is no substitute for quality. Equipment that is designed, engineered and built to a high standard will help you to go the distance from day one. The initial purchase price may be a bit pricier, but that will be insignificant if equipment downtime is taken into account.

2. Choose manufacturers with a strong Dealer Network. A local presence gives you access to parts, support, training and advice on meeting your obligations to standards and regulations that may not be otherwise available to you. Additionally OEMs with strong networks are more likely to be investing in supporting their product users.

3. Turn the equipment over before you reach the end of its economic life. As the equipment ages, the maintenance and repair costs increase, while down time increases at the same time as making it less economically viable. It’s worth remembering that not all equipment will suit your needs, as Access equipment requires major inspections at ten years of age, which can lead to significant costs if your equipment is of a poor quality. Carrying out a proper assessment of economic life will save you making what cold be an expensive mistake.

4. Investigate your options. Some manufacturers offer technologies that will save you significantly on running costs, but will require you to purchase the option. Do the sums and see if it works for you. An example of this is Kalmar K-Motion, which offers operators a 40% fuel saving. The system has an upfront cost that will ultimately save you money in the long-run over the machine’s life cycle.

5. Equipment tracking is available as either a standard, or as an optional add on with many manufacturers. The low cost of data has enabled this technology, which was previously too costly, to become an increasingly standard feature. Today you can track your equipment in real time to assist in process improvement, track maintenance, fuel usage, and even compare operators with a view to improve the cost outcomes. These systems also reduce the chances of employees or contractors doing the wrong thing. Kalmar offers SmartFleet, Manitou Easy Manager, and Kobelco run GEOscan, amongst others.

6. Maintenance is taking a turn as OEM’s recognise the importance of “Whole of Life” numbers and how it can impact purchasing decisions. Many manufacturers are improving technology to enable service cycles to be extended. An example of this is Manitou moving many schedules out to 500-hour intervals and delaying hydraulic oil changes until 2000-hours, effectively doubling time between services. A change, such as moving to 2000-hour hydraulic oil changes, have a significant impact on costs with some machines costing several thousand dollars, plus the disposal of the waste oil and labour costs to change it. Kobelco have moved their hydraulic oil changes out to 5000-hours on some of the Generation 10 machines, a timeframe that was originally set at 2000-hours. Entering into a maintenance agreement or contract with the dealer is a way to ensure the equipment is maintained in accordance with the manufacturer’s recommendations, while still keeping costs in check.

7. Train operators, this reduces operator error resulting in damaged equipment, premature wear and tear and downtime. Operator error is an area that fleet operators can prevent maintenance and damage cost mounting. Often, a strong dealer can offer familiarisation training and recommend ways to operate the equipment in the most efficient way.

8. Choosing the correct machine up in the right way from the start will assist in reducing costs. Using the right tool for the job is the best way to ensure it will do the task you need it to do right from day one. A strong dealer can assist you with making the correct purchasing decision, set it up to suit your needs, and make sure that it stays that way.

9. Ensure the equipment meets Australian Standards. This ensures that in the event of an incident or accident, you as the employer have done everything you can to ensure the equipment is safe. There is plenty of “grey import” equipment in the market that’s often sold as “meeting standards”, and sometimes this can lead to disaster. Working with an authorised dealer will ensure your equipment is compliant with industry regulations.

10. Spare parts are available in every shape and form from the Original Equipment Manufacturer (OEM), or plenty of “Off Market” sources selling non-genuine replacements and spares. Ultimately, which option you choose isyour decision, however, these so called equivalents are often simply a generic, made-to-fit part that won’t necessarily meet the manufacturers specifications. Can you afford to risk large capital equipment for a few dollars saving?

LiftRite Hire & Sales are the authorised Western Australian dealer for Manitou, Gehl, Kalmar, and Kobelco. With almost 35 years in the materials handling industry, we have become a reference point for customers seeking valuable, and correct information. LiftRite can hire, sell and maintain your equipment either in Perth or through our state-wide service network.