Managing successful packaged food production lines often requires manufacturers to be able to operate within tight financial margins. For this purpose, many use as a guideline a well-established metric in the industry: Total Cost of Ownership (TCO).
In simple terms, TCO takes into consideration the purchase price of a piece of equipment, as well as the operational costs it incurs over time. TCO is often used in procurement analysis when preparing business cases to secure additional capital expenditure to update food production lines, as TCO focuses on all costs directly related to the piece of equipment itself, rather than solely on the cost of the equipment.