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Equipment Replacement Calculator

See whether keeping or replacing a piece of equipment looks less costly on an annual basis, plus an optional check on cash after purchase.

Compare the estimated annual cost of keeping your current equipment against replacing it, using repairs, extra operating costs, downtime, financing, insurance, and maintenance. Optionally check whether your projected cash after purchase would stay above your reserve floor.

Current equipment assumptions

Enter the annual repair costs you expect if you keep the current equipment.

Enter extra annual operating costs from keeping the current equipment, such as lower efficiency, higher fuel or energy use, or added labor.

Enter the annual hours of expected downtime if you keep the current equipment.

Enter the cash cost per hour of downtime, such as lost revenue, idle labor, or missed jobs. This rate is used for downtime in both the keep and replace scenarios.

Replacement assumptions

Enter the annual financing or lease payment cost for the replacement equipment.

Enter the annual insurance cost for the replacement equipment.

Enter the annual maintenance cost for the replacement equipment.

Enter the annual hours of expected downtime if you replace the equipment.

Optional cash-timing check

Fill in all five fields below to see whether your projected cash after purchase would stay above your reserve floor. Leave any of them blank to skip this check.

Enter your projected lowest cash balance in the period after the purchase, before subtracting purchase-related cash outflows.

Enter the minimum cash balance you want to keep on hand as a reserve.

Enter the down payment required for the replacement.

Enter one-time setup, delivery, or installation costs for the replacement.

Enter the first financing or lease payment due at or near purchase.

Results

Enter the current equipment and replacement assumptions, then choose Calculate annual-cost comparison.

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Source: owner-advisor.com

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