When it comes to asset management, there are two primary options to consider: planned maintenance and repairs or replacement. However, it’s difficult to ascertain when to stop maintaining an asset and when to replace it. Getting the timing right is crucial.
When to Repair or Replace Equipment?
The answer to this question boils down to cost. When the cost of repairing a piece of equipment is far more than its value, it’s time to replace it. When the cost of repairing the asset is lower than the value, you get it repaired.
It’s not different from the logic that insurance companies apply.
Why is the Timing Important?
The question of whether to repair or replace is an important one. When you replace an asset sooner than you ought to, you are essentially wasting resources. When you dump an asset and replace it before its end of life, you are spending more than you have to and not optimising the available resources.
On the other hand, if you wait too long to replace, it can have an adverse impact on your business including:
- Production delays
- Risk of accidents and injury
- Higher labour costs
- Impact on productivity and efficiency
Additionally, when you frequently call for repairs on-demand, it can increase the pressure to reschedule or even reallocate resources. This can prove to be a painful experience for everyone involved.
To make the right call, you will need important pieces of information: cost to replace, cost to repair and asset value. However, you can’t pull these numbers out of thin air. You must calculate them, which is easier said than done.
Expense is an important part of any business. Most organisations consider the upfront cost of planned maintenance as an unnecessary expense. However, it’s important to look at the long-term benefits of this strategy for your business.
For reliable, professional planned maintenance solutions, contact Broad Services today!