A useful TCO states its period, assumptions and included costs. Adding purchase quotes does not automatically produce a complete TCO.
Define scope before using a formula
Start with comparable usage: capacity, service life, production rate and expected quality. Add documented delivery and installation, energy, maintenance, consumables and retirement costs to the net purchase price. Deduct a residual value only when there is evidence for it.
Avoid counting a service twice when it is already included in the price. Document recoverable or non-recoverable taxes, currency, inflation and, when relevant, discounting. Downtime costs and productivity gains remain assumptions to justify, not guaranteed discounts.
A simple three-year example
Two machines provide the same service for three years. A costs USD 40,000 to buy and USD 12,000 per year in energy and maintenance. B costs USD 48,000 to buy and USD 7,000 per year for those same items. This fictional example excludes tax, discounting, residual value and all other costs.
| Equipment | Three-year calculation | Included total |
|---|---|---|
| A | 40,000 + 3 × 12,000 | USD 76,000 |
| B | 48,000 + 3 × 7,000 | USD 69,000 |
B costs USD 7,000 less across the included items despite a purchase price USD 8,000 higher. The conclusion changes when service life, usage or annual costs change. Check the inputs and test a conservative scenario.
Separate facts, estimates and unknowns
Keep a source for each cost item: a quote, maintenance contract, measured consumption or internal assumption. Missing data is not zero. Compare multiple assumptions when energy prices, maintenance frequency or resale value remain uncertain.
What BidResolve covers today
BidResolve compares received quotes and calculates a supplier allocation from represented, accepted terms: quantities, prices, discounts, fees and constraints. The separate check verifies that scope. It does not automatically calculate every ownership cost, predict failures or perform financial discounting.
Use the checked purchasing plan as an input to your TCO analysis. Then add operating and retirement costs using your own sources and assumptions, without presenting them as covered by the purchasing-plan check.
Turn supplier quotes into a purchasing plan
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