How to Measure Return on Investment
By: Kelly Buck
We get it. Scale systems can be a serious investment. Often times it is incredibly tempting to go with a scale that has a lower upfront cost and save some the money now. But how much money is that mindset saving you in the long run? What happens when you have to buy a new bench scale year after year? What about when lightning strikes your truck scale or you find out you’ve been giving away thousands of dollars because your scale thinks 150lbs is actually 100lbs? So how can you measure return on investment with the expenditure before you make those mistakes?
1) Look at the Cost Over Time: In evaluating a purchasing decision when measuring return on investment, many companies will estimate a Pay Back Period (PBP), or how long it will take for the equipment to pay for itself. When purchasing weighing equipment, you need to look at the cost of inaccuracy as your first stop. How much money do you make if you improve your accuracy by 5lbs each time the product moves over a scale? What happens to your bottom line if you are 50lbs less accurate? For some companies and processes that can easily be the difference between profitability and non-profitability.
2) Longevity of Equipment: This is the section that is more difficult to prove on the front end, and rightfully so. The best way to prove the longevity of equipment in your production is to put it to the test yourself. Obviously, this is not the most practical scenario but you do have a few options at your disposal. Ask your current scale provider for their service records on your equipment. If you have the same manufacturer across your plant you can get a very good idea of how their equipment lasts based on the records provided. You can also look at the actual design of the equipment. Can the manufacturer put their product to the test with third party evidence? What are the types of overload protection built into the scale? What kind of lightning and water protection does the scale have?
3) Ease of Use and Maintenance: This should be a question you ask before you make your decision. Find out how old the model of the equipment is. Is there a new version of this equipment planned? Has the manufacturer proven themselves with reliably keeping parts in stock for existing product? What kind of intrinsic advantages can adding this equipment add to your production? Will operators be able to gather data quickly and easily with a large color display with color based values or is the display small and monochromatic? It is always a good idea to ask the provider about what kind of preventative maintenance programs they offer and how theirs differs from the competition.
Feel free to reach out to us and see how METTLER TOLEDO equipment with Weigh Better service stacks against these pillars. See what makes us Weigh Better.