In determining whether a piece of equipment is essential for the operation, it is necessary to appreciate two important facts:
Before How much money will allow you to operate?
According to How much money will be used during his life time cost?
The first number is determined using information on machine performance, efficiency, cost of raw materials, and also the selling price (s) from the elements, you can produce. The second photoincludes a series of life-cycle cost calculations (see the sentence of this agreement, or consider it as two words: "life cycle"), accepted, and the phrase more current, the total cost of ownership (TCO).
The North American Association of Food Products Manufacturers (NAFEM) has coined the term of the latter only because the term "life cycle" is such a broad interpretation. The idea is to charge the owner an additional piece of important equipment with which everyone is aware of are compared: aThe vehicle. You know, for example, that the fuel you need an oil change and other regular maintenance, new tires, insurance and so on.
You know you have a good variety of options (air conditioning, the update of the sound, etc.) to buy or to skip them. They also know that several vehicles have a better reputation than others for safety and durability, and that in most cases, some vehicles lose their value once you drive the dealer lot. Could bedifficult to think about all of these long-term factors when you can see yourself in that shiny new car and you know you can qualify for the loan to drive it home.
And so it is with foodservice equipment. Identifying TCO is a way to analyze all from the factors, tangible and intangible, in order to make prepurchase comparisons. In 2007, NAFEM introduced an products existence cycle price tool that can be downloaded from its Web website (www.nafem.org) to guide prospective buyers via the procedure of determining these expenses and making comparisons.
The device walks the user through a thorough set of "detail forms" to fill out. The types contain all the costs associated with the purchase, service and repair, preventive upkeep, the actual operation of the equipment, and its eventual disposal. It contains variables to factor in, in light, moderate, and heavy use. What are some of the components of TCO? In addition to its list price, you will consider such things as: Freight expenses to get the equipment for your location.
Installation costs. Utility prices and energy efficiency are especially essential when identifying whether to select gas or electric equipment, although these expenses also are among the least estimated. The NAFEM committee that developed its existence cycle price device claims it can pinpoint power and water consumption within 90 percent based on laboratory tests.
The expenses of supplies, such as chemicals and filters, necessary for daily operation. The expenses of accessories. Extra expenses of having to ventilate or install plumbing so that you can use the equipment. Labor expenses to operate the equipment, such as training expenses. Insurance expenses. Preventive maintenance. What does it take to clean it? Oil it? Calibrate its thermostats?
Program it? Repair costs, such as parts and labor. Many feel a higher initial cost, if it includes local, dependable service, is usually worth the price. Trade-in or salvage worth, and what it expenses for disposal if necessary. Some kinds of appliances contain mercury, refrigerants, and other substances and should be disposed of as hazardous waste, for which you will find additional fees.
After filling out the detail forms, the tool creates a spreadsheet that summarizes every category of expenses and permits the user to think about the total cost of a piece of products more than its lifetime. As you see, purchasing products is not as simple as choosing the most reasonably priced item you can find. A lower-priced choice may not be worth the cash if it only lasts one-half or two-thirds as long as a higher-priced model.
Ice makers, for instance, can be selfcontained or installed with a remote compressor. The installation for the remote compressor is a lot more expensive, but it might extend the helpful life of the ice maker and/or reduce maintenance expenses, since it is a lot more very easily accessible. Other, perhaps much less tangible factors to add to the mix are discussed in the next paragraphs.
Ease of use is really a cost-related consideration simply because the more difficult it is to operate and maintain products, the longer it takes employees to learn the task and to use it properly. This increases labor expenses, which impacts your bottom line. Always consider labor savings as an equipment advantage.
An example: By utilizing a cook-chill program, a chef can prepare his or her specialties and quick-chill them to nearfrozen temperatures, where they will keep safely for several days. Then, even if the chef is not there, a less skilled line cook is perfectly capable of reheating it for serving. Self-cleaning appliances may be more expensive initially, but they might also pay for themselves faster by reducing the labor it would take to clean them manually.
With these types of options, you can schedule employees' time a lot more productively, at the least cost to the operation. Projected use is also a consideration. The tilting skillet, the convection steamer, and also the range top with oven are all examples of multiple-use equipment. In a busy kitchen, versatility is key. Combining different functions in a single piece of equipment is another way to improve workers' productivity.
Whenever feasible, buy products that may do a lot more than one thing for you. Brand names mean a lot in the restaurant business. Ask any chef who has been around a long time, and you will get some marked preferences for certain types of equipment. While a newcomer to the industry may be swayed by advertising or the recommendations of dealers, the seasoned restaurateur asks kitchen personnel what they like, and why.
New products should also come with warranties, which cover parts and workmanship for a period of time (usually not a lot more than one year) and then "parts only" for another specified length of time. Usually, a warranty indicates that the manufacturer will replace or restore, free of charge, any part that proves not to work properly due to "defects in materials and/or workmanship.
" Most warranties go on to mention that they're valid only if no one has altered the equipment and if it may be correctly installed and maintained. Actually, most warranty hassles result simply because the products has not been correctly installed. Payment terms for the products are often key when cash is tight. When you are spending a minimum of 00 for a commercial mixer, expect some strings attached unless you can afford to pay cash.
Should you borrow money from a financial institution to purchase equipment, the financial institution technically owns the equipment until the loan is repaid in full. If you are leasing your space, this gets a little sticky. The lease should include information about what to do should you fall behind on your payments, and the landlord must agree to grant the bank a very first lien on all financed products.
This means if the rent is not paid, the bank can repossess the equipment prior to the landlord can. If the local bank is reluctant to lend cash for equipment, ask the equipment dealer. Many dealers finance or lease entire restaurant installations. It is helpful to have an attorney look over the legal aspects of these arrangements.
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