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EURO RAIL EXPERTISE


Sofia Löfblad of Handheld Europe says buying decisions need to be based on the real, life-time costs of the product, not just the upfront cost.


W


hen going out to purchase new mobile computers,


most businesses may be tempted to base buying decisions solely on a product’s purchase price. But because the purchase price does not reflect the real cost of the unit, this could turn out to be a costly mistake. To truly evaluate what a product costs, we need to look at the cost over the life of the prod- uct. This is known as the product’s total cost of ownership (TCO).


Even if we do not know the term TCO, we often apply it in other ar- eas of our life. When we are buy- ing a new car, most buyers will do at least some research to find out about the vehicle’s repair record.


A cheaper car that spends half the time in the repair shop is no bar- gain.


56 | rail technology magazine Jun/Jul 11 Rough treatment


The same concept applies with mobile computers. Computers taken outside of a safe office envi- ronment are going to be subjected to a lot of rough treatment. Drops, vibration, water, dust and extreme temperatures are only some of the


conditions a computer may face in the field. It seems logical that you would not take a delicate piece of electronic equipment into a rough environment, but that is what hap- pens more often that you would think.


Why? Because many buyers of mobile computers are lured by the lower initial purchase price into buying non-rugged or minimally ruggedized equipment solely be- cause of the cheaper purchase price, failing to take into account the higher costs of actually using this equipment in the field. By failing to purchase the right kind of unit for the job and the envi- ronment, they will be paying a lot more in the long run than if they had purchased a more rugged, but more expensive, piece of equip- ment initially. In other words, the


more expensive unit is actually the cheaper unit.


A higher initial investment can most often give you a lower TCO, which takes into account all the actual costs incurred during the entire life of the product. TCO is comprised of hard costs (like pur- chase price, development, replace- ment, and deployment costs) and soft costs (training, repair costs, and downtime costs).


As more organisations become more dependent on their mobile workforce, downtime costs have become increasingly important and costly. If a field service rep has a device failure at the start of his day, the lost service revenue and customer goodwill from all the missed service calls can be sub- stantial.


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