What to Consider in Replacing An Existing Equipment With A New & Reliable Item?

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4 years ago

In every field of study, the use of machines have always been our partner to make our job easier and efficient.

If you are considering of replacing your old and used equipment with a new one, you have to ponder the most common economic question which is

“Do its benefits exceed its costs?”

It is important to assess how feasible the alternative is as a replacement of the present one.

Considering that the present equipment is a portable engine that could be utilized for 10,000 hours before failure occurs, it generates a rental income of Php 20,000 and the Php 5,000 is spent for the 5 outages, which is Php 1,000 per repair. Imagine the big difference with the performance of the new equipment which offers 14,000 hours (40% greater than the present) serviceability during operation, Php 28,000 rental income and Php 5,000 for the repair and maintenance of the equipment. Given that the new equipment offers 40% greater reliability in comparison with the existing one, most probably the item would be expensive, but it is advisable to invest in this new and developed item rather than opting for substandard equipment as it will benefit you in the long run. 

The 40% increase in the Mean Time Between Failure (MTBF) during operation only means that, the new equipment offers higher maximum uptime for the equipment to function.


Did you know that:

The Mean Time Between Failure or MTBF is the metric use to measure the time from the first failure occurred or the Mean Time To Repair (MTTR) plus the total time it would take for the next part to fail or the Mean Time To Fail (MTTF).


Another thing to ponder is:

"How it might be feasible in an Engineering Economic Analysis to consider this situation in terms of the monetary unit?"


It is also crucial to note that high MTBF will only affect for unexpected maintenance, but normal maintenance schedule has still to be done.

In this case, if the equipment has 5 planned maintenance schedules, it would cost Php 5,000 and if there were at most 2 unexpected outage incidents, it would cost Php 2,000.

Being aware of the planned downtime of the equipment is necessary to conduct a regular maintenance which will help to avoid unplanned downtime. The greater reliability of the new piece of equipment the longer serviceability. 

To put it in simple terms, the new equipment offers higher efficiency and usability in the operation.

Therefore, it is feasible to consider the reliability of the equipment in an engineering economic analysis to assess the unexpected maintenance of the equipment since it is widely neglected. 


How's that for an Intro to Engineering Economic Analysis? Did you learn something? Comment your thoughts below.

Have heard about the Learner's Community? Its a community where you can share what you've learned, it may be from school or from work.

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4 years ago

Comments

Nice one

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4 years ago

Hope you've read it though. Thanks!

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4 years ago

I somewhat agree to this. Replacing equipment is a larger investment, so many technicians choose to repair the equipment instead of replacing it. But in the long run, the costs that go along with frequent breakdowns - lower productivity, defective output, rising labor costs, and unmet production schedules - can sometimes be greater than the cost of replacing the equipment outright. Thanks for sharing! Good day!

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4 years ago

Yes it is, and we really do have to weigh the cost that both items gives us. The old equipment can maybe, still work however the maintenance cost could be really a pain, and buying or replacing it with the new one could actually increase production rate and income generation. Thanks for reading my article. Have a good day!

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4 years ago

Yes ! In some cases we have to purchase both

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4 years ago

Yes, sometimes settling with the existing one could be the best choice, especially if the knowledge of the equipment as to be considered.

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4 years ago

nice like :D

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4 years ago

Did you learn from it?

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4 years ago

Yeah sometimes we must bought a new one for long term basis and for better usage.. Thanks to you

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4 years ago

yeaaah, but let us not forget the possibility of unexpected maintenance cost of the new equipment.

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4 years ago

That was posible.. It depends on the situation if it worth to buy a new one.. New one have also atleast 1yr to 2yrs warranty

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4 years ago

yes, it depends on the type of equipment that you're going to buy. But sure new equipment offers better deals.

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4 years ago

Yeah your right.. :) new one is always better than the last. When it comes to equipments

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4 years ago

that't right, innovations and development is nonstop

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4 years ago

Yeah that's what technology all about

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4 years ago

you mean, new technology?

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4 years ago

reći, na nepoznatom terenu sam bio. Pozdrav za tebe. Pisao sam ovo na našem jeziku, pa da probam i s engleskim. Usudio bih se reci da varda, ti imas

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4 years ago

Will you translate it in English please? I'd love to know your comment on my article.

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4 years ago

Beautiful theme..please subscribe my profile

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4 years ago

Nice

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4 years ago

Have you learned anything from it?

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4 years ago

Aba may pa trivia pa si nana mo. Haha Nice answer hit on point. :)

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4 years ago

Hahaha of course. So that others could learn as well, especially for non technical pips

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4 years ago