A TCO analysis is the first step to drive down overall costs and improve profitability
In today’s competitive world, the concept of Total Cost of Ownership (TCO) is an important one, for both buyers and sellers. Rather than only considering the purchase price of an object, TCO looks at the complete cost from purchase to disposal. This will include costs that are likely to be incurred during the product’s lifetime, such as maintenance, repair and insurance.
From a packaging supply chain point of view, TCO involves reviewing the entire chain and having an overall view on the total process, detecting opportunities for improvement and potential for increasing profitability. A TCO analysis will likely look at three major components. There’s the cost of the packaging material itself; the operating costs (involving the packaging processes of our customers for example); and the logistics costs.