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Influencing Total Costs of Ownership in the tendering phase

Concise summary of this best practice

Purchasing decisions of capital-intensive goods have a long-lasting impact on the company’s profitability. As a result, potential buyers of capital goods want to know and understand the expected Total Cost of Ownership (TCO) during the tendering phase.
Vanderlande is a supplier of capital-intensive goods who is increasingly faced with TCO related challenges. Interestingly, many Vanderlande systems are designed to satisfy specific customer needs, so how can you estimate the (expected) TCO phase when the product design is not frozen? And how can Vanderlande create the highest added value, by influencing the TCO by making a smarter system design?
Together with Eindhoven University of Technology, Vanderlande developed an intuitive tool that enables Vanderlande to calculate, evaluate and influence the TCO and the System Availability of a customer-specific design in the tendering phase. This research project shows that it is both smart and financially feasible to design for availability. This award-winning project is portrayed in this best practice. Moreover, recent applications of the tool during tenders demonstrate the added value of the tool.

Relevant for
Suppliers and buyers of capital-intensive equipment

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Key terms: 
Total Cost of Ownership
System availability
Tendering Phase
System Design

About ESCF

The European Supply Chain Forum (ESCF) is the premier Operations and Supply Chain Competence Center in Europe. We connect internationally ambitious companies with a focus on long-term partnerships. The ESCF offers an excellent opportunity to share problems and solutions in the area of Operations and Supply Chain Management. Members are able to share their thoughts with and learn from other multinational companies. We provide a global, interactive platform and facilitate joint projects and research. ESCF excels in SCM talent development and life-long learning.

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Target industry sector

  • Process industry (chemical and other)
  • Pharmaceutical industry / Health Care
  • Capital goods industry, especially service parts logistics
  • Retail & Internet / E-commerce
  • Consumer packaged goods
  • Mass assembly
  • High-tech (consumer electronics, semiconductors, contract manufacturing, communications)
  • Logistics service providers

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