Maintenance Cost

One of the ways of looking at this is to take the figure above as the local standard. If one accepts that the role of the Engineer is to make him/herself redundant, then that concept translates to driving down the above figure by fair and legal means. The objectives are:

• better practices and efficiency
• waste and power consumption reduction
• greater output or de-bottlenecking
• substitution of improved equipment
• capital investment in plant and processes that will produce operational improvement

All of these will generate a range of technical solutions that will differ from site to site, some of which will be more attractive than others based upon local conditions. So there is no simple answer to this question. It is most unlikely that any reader is collecting maintenance cost per ton of oil data across all the oil processing lants in the world against which any specific comparison could be made.

And if I told you that my maintenance cost was 2.43USD per ton of oil processed, of what value is that information to you? In the first instance, would you believe it?

I don't know if it directly applies, but ROT (rule of thumb) for typical manufacturing in the US is 5% - 10% of total investment. So if you have spent $1 million on a piece of equipment, your total maintenance cost should roughly be $50,000 - $100,000. Granted this is just a ROT, you may want to check out some authors such as Terry Wireman and Keith Mobley.

That sounds high, no wonder your looking for answers, but your looking in the wrong place. You need to find and ask and accountant.

Costs come in two different methods, fixed and variable. In what is called GAAP (Generally Accepted Accounting Practices) Fixed costs are the building, management salary, advertising, electric bill, phone bill and so on. Variable costs are the costs to manufacture, such as direct labor, direct material, and not much else.

In most companies the cost of maintenance is a fixed cost, that is the salaries and budgeted cost of spare parts and replaceable parts. The thought behind that is that cost will not change if you increase production, or decrease production.

It looks like your accounting department has got a handle on your plant and they have taken the cost of maintenance and found a relationship between that and amount produced. That means as you produce more, maintenance costs increases, and as production declines, so does the maintenance costs.

If that is not true, you can make a case for your accounting department to adjust the way they account for maintenance.

Is there any criteria between the machinery cost and maintenance cost?

Machinery is a sunk cost and it should be your money maker. Maintenance is a variable and unavoidable cost to keep the money maker worth it's keep.

If you do predictive or preventive maintenance you can generally reduce downtime and possibly come out pretty close to even -- downtime due to failure is generally a VERY expensive situation and costs (in many industries) more than the maintenance and even in some cases more than the cost of the machinery.

Downtime should be avoided at all cost.

Yes, all who responded to your querry have somewhat answered you, as there's no straight forwar answer to this querry.

"ENGINEERING IS COMMONSENSE WITH COST IN MIND"

If the life of the machinery is 20 years, the preventive maintenance + the breakdown maintenance and the loss in production due to down time should not exceed from 2% of the cost of the machine in the first year and 40% of the residual value of the machine in the last year.

As mentioned above, prudent analysis at every stage of production/ processes and stingent control on losses and waste is the best way to keep the maintenance costunder control.

I once worked for a vegitable oil extractor, who got carried away with energy saving and introduced expensive maintenamce programme which jacked to capital cost up and it did not make economic sense on the books at the end of the year.

Hence, "Engineering is common sense with cost in mind". Is it worth spending so much to save this much on efficiency? This is the question the maintenance engineer should answer.

Dears All

refer to the subjict , is interusted for me , as I am profitonal in this concerned .

maintenance in fact is quality and cost

from my opinian I summerised the following actioned to you to reduce the cost

1- proper rotating equipments to be sillected from biggining as required ,for examble to choose the sutable pump to give the target performance , and to sellect the right materials along the processing materials , efechancy , tempareture , proper maint. and installation , control system , and perfict installation with cooling and precotions

2- incase you have the right equipment with approved process , remain proper type for maintenance , suchedule to carried out , preventive maintenance , daily check , monthly inspection reports while the machine on line or off line , to got record for maintenance schaduling , and anual maintenance for all equipments and vesils

3- the spare parts , to be obtain from general high quality sublyer up follow up improovement conditions , materials to be suit performance and long life

4- all the normal worn out and damaged parts has to be maintained and reconditioned in maint. machine shop under qualified mill wrights , and used again, not to be ordered from vendors , at the end this type of maint. plane help to improve the performance , and reduced the costs

Anticipating your kind cocederation and acceptance with regards

Abdul Hameed Al Darawish

Dear All,

I was reading all the comments made by the members.

I have asked for any thumb rule or guide to know if maintenence cost is going high or not. I have not asked for preventive/predictive maintenance/breakdown maintenance - if during this you have to change a part/bearing - it will go in maintenance cost only.

So, I wanted the general rule to assess the situation.

If anyone can guide on this???