Considering a Pump’s Total Life Cycle Cost

When it comes to sourcing pumps, or indeed any equipment, businesses are increasingly faced with budgetary pressures that can see them making purchasing decisions that are not the most economical in the long term. This is usually the case when the buyer considers only the upfront costs of the purchase.

The concept of Product Life Cycle Costing was first adopted in the 1960s by the US Department of Defence to aid military procurement. The basic principle is that by considering all costs associated with buying, operating and maintaining, the lowest long term costs will be achieved: LCC = Initial Costs + Future Costs 

Initial Costs of a Pump

Initial costs are easily identifiable at the point of purchase so are typically the costs that procurement teams consider. These include the price of the pump plus delivery and installation.

However, some upfront costs can be overlooked. One example is operator training. Some pumps may require more manual intervention in their operation than others and therefore more training. Or perhaps your operators have been using a pump for many years. Would buying a slightly cheaper pump that works completely differently warrant the training costs?

Future Costs of a Pump

Putting a monetary value on future costs can be difficult, which is why they are often neglected. The problem is that future costs can amount to around 83% of a pump’s life cycle costs, and initial costs only the remaining 17% (World Pumps, 2017). This is enough to demonstrate the importance of considering all lifetime costs.

• Labour – Labour is the biggest overhead in almost all companies and therefore wasted time is wasted money. If the pump you’re considering requires operators to manually intervene a lot, then this a cost you need to consider. A pump supplied with certain automation or control features such as preset batch meters or level switches may initially be more expensive, but the time it saves your workers could be huge.

• Energy – According to the US Department of Energy, 16% of a typical industrial facility’s electricity costs are generated by pumps. Methods of reducing energy consumption include installing a variable speed drive to operate the motor at actual requirements and investing in parallel pumping systems so that a large pump doesn’t have to be run when duty requirements vary greatly.
  
• Maintenance – Like any equipment, all pumps need routine maintenance as parts wear. By carrying out regular servicing, not only do you extend the lifespan of the pump, but you’re less likely to incur unexpected failures and downtime. The manufacturer’s instruction manual will advise the frequency of routine maintenance and will also recommend replacing certain components such as the seals, wear rings and impellers every 1-2 years. The costs of carrying out routine maintenance however can depend upon the complexity of servicing, the price of spare parts and the quality of the pump’s internals.
  
  Let’s say you’re choosing between two pumps. You have a centrifugal pump cast in bronze that has a back pull-out design, meaning that the motor and pump internals can be removed without disconnection from the pipework. The other is a few hundred pounds cheaper, but it is made of pressed metal, which is more susceptible to damage and misalignment and needs to be removed whenever maintenance is required. The initial costs may be cheaper, but over the pump’s  lifespan, will maintenance costs exceed the difference?

• Downtime – Depending upon the pump’s application, downtime can be extremely costly for a business in terms of loss of output or alternative costs. Imagine your pump is responsible for dosing a specific quantity of ingredient in your production line. If the pump unexpectedly fails, then the production of the mix comes to a halt. The cost of this downtime could be the loss of revenue, unhappy customers whose demand you haven’t met or the labour costs of an employee having to take over manually.

Where downtime costs are unacceptably high, you should consider a backup pump in a parallel pumping system that kicks in when the other fails, as well as onsite spare parts for quick maintenance.

• Disposal – Generally speaking, this shouldn’t vary too much across pump types, with the exception of pumps for hazardous fluids. During decommissioning, the pump will need to be thoroughly cleaned out for environmental purposes. A “clean in place” pump would therefore save time and effort here.

By considering the above factors, you can be confident that you will be receiving the pumping solution that offers the lowest total life cycle cost.
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