If you are looking into setting up your own business, one of the things that you will need to take into consideration is the expenses that your company will incur in a year. One of the expenses that you will need to take into consideration is the total cost you will be incurring for owning a particular printer model for your business. This can be determined though the Total Cost of Ownership calculation process.
What is Total Cost of Ownership?
Much of the equipment that you purchase whether for personal or business use would eventually incur additional costs after the initial purchase. The Total Cost of Ownership is a process that allows a business owner to determine the overall cost that the company incurs upon purchasing a particular device or equipment such as printers.
Why is Calculating Total Cost of Ownership Important?
Being able to calculate the total cost of ownership of your printers is important for you especially if you are going into a printing business. The amount will allow you to determine how much you will price for your services to your potential customers to compensate for the expenses you will incur and make a profit at the same time.
How do you Calculate Total Cost of Ownership?
Total pages per year. This is computed by multiplying of the total number of pages that you will be producing per printer by 4. This is because financial assessments are done every 3 months.
Acquisition Costs. To get the acquisition cost per printer unit, add the Year-to-Date depreciation value of the printer, the Cost of Capital, Property Insurance of the printer unit and any taxes.
Support. The cost for support for each printer unit is the sum of the amount purchase, installation cost, on-going support (if any) and the average monthly minimum amount for each printer (if you are just leasing the printer units).
Maintenance Cost. To get the printer maintenance cost, add the estimated percentage of the time spent by a 3rd party support vendor will have on a printer unit to the annual 3rd party vendor support cost. The total is then divided against the percentage of black and white and colored printers.
Consumables. Multiply the total cost of staples to the percentage of color printers and add the results to the total cost of the ink cartridges that you have purchased per printer.
Things to Remember when Computing the Total Cost of Ownership
Make separate total cost of ownership computations for black and white and colored prints even if your printer is capable of doing both. This is because black and white printing is relatively cheaper than colored printing.
Create separate total cost of ownership computations based on the kind of printers that are used. This is because the service, maintenance and consumables incurred are dependent on the kind of printer that you have.
