Construction Total Cost of Ownership

Total cost of ownership,1 or TCO, is referenced often in the construction industry, but what does it mean and how can a lubricants supplier play a role in helping companies achieve it?

Simply, TCO means lowering the lifetime cost associated with a given piece of equipment – Not just purchase or rental price, but also cost of routine maintenance, repairs, etc. 

With increasing frequency, the industry is seeing operators extend the life of equipment well beyond warranty or opting to rent rather than purchase new machinery in an effort to maximize availability of capital and minimize operating costs. Those investing in new equipment are looking for new technologies that offers the greatest cost-saving potential. However, one thing that remains under-appreciated is the impact that lubrication practices can have on productivity. 

Whether you choose to own or rent your critical equipment, there are two key ways to reduce TCO across the board in the construction sector: 

  1. Ensuring that you use the most appropriate products and lubricants for every piece of equipment in your fleet, such as Shell oils and Shell Desiccant Breathers, and
  2. Implementing effective lubrication management systems that are clear and straightforward for staff to execute

Shell’s experts come alongside your team to assess a site’s end-to-end maintenance practices, costs, and ultimately deliver customized lubrication recommendations and solutions capable of streamlining maintenance and minimizing total costs. Our experts have a proven track record of reducing the total cost of equipment ownership by helping you embrace more efficient lubrication solutions in your operations. 

With deep industry experience and an understanding of even the most complex operations, you can trust that the advice and solutions our team offers will positively impact your bottom line through decreased maintenance costs and decreased downtime. Shell has already helped customers worldwide to achieve over $139 million3 in savings.

As the construction industry continues to grow, particularly in areas that are rapidly urbanizing, there is greater competition to deliver projects on budget and on time. Maximizing productivity with unmatched uptime rates all but guarantees success in this fierce market landscape. Adding the right partner to your team may be the competitive edge you’ve been searching for.

1. Total Cost of Ownership (TCO) is defined by Shell Lubricant Solutions as the total amount spent on the equipment, incl. cost of acquisition and operation over its entire working life, and costs from lost production during downtime.

2. Based on research commissioned by Shell Lubricant Solutions, conducted by Edelman Intelligence (Nov - Dec 2015.)

3. Based on savings delivered to Shell Lubricant Solutions customers as of 2015.

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