Why Total Cost of Ownership Matters

Buying commercial kitchen equipment isn’t just about the price tag. What truly matters is how much that equipment will cost you over its entire lifetime. The Total Cost of Ownership (TCO) gives a clear, correct view of that long-term expense. For busy restaurants, caterers, and food producers, understanding TCO helps avoid hidden costs, manage budgets, and make smarter investment decisions.

At Herits, we help operators see the bigger picture. A cheaper machine might look appealing upfront, but if it consumes more energy, breaks down often, or needs costly parts, it can end up being far more expensive in the long run. Knowing your TCO helps you buy smarter, plan better, and build a more sustainable business.

What Is Total Cost of Ownership?

The Total Cost of Ownership is the combined expense of buying, running, maintaining, and eventually replacing a piece of equipment. It includes every cost that affects your bottom line over the equipment’s lifespan.

TCO typically includes:

• Purchase price: The upfront cost of buying the equipment.
• Installation costs: Plumbing, electrical, or ventilation setup.
• Energy and water usage: Monthly running costs that vary depending on efficiency. –
• Consumables: Filters, detergents, or replacement parts.
• Servicing and maintenance: Scheduled inspections, cleaning, and repairs. –
• Downtime costs: Lost revenue or wasted food when equipment fails. –
• Resale or disposal value: The return (or cost) at the end of its life.

A full TCO assessment gives you a true financial snapshot that goes beyond the sticker price.

The Herits Total Cost of Ownership Calculator

The Herits Approach to Calculating TCO

At Herits, we use a structured, transparent process to calculate TCO for every client. Our Total Cost of Ownership Calculator is designed to break down the lifetime costs of your equipment into simple monthly or annual figures. Here’s how it works:

1. Gather cost data: Record the purchase price, delivery, and installation expenses.
2. Estimate running costs: Factor in energy use (kWh), water consumption, and average hours of operation.
3. Include maintenance: Add routine service, filter replacements, and expected repairs.
4. Account for downtime: Estimate how much lost production or labour cost a breakdown would cause.
5. Subtract residual value: Consider any resale or trade-in value at the end of the lifecycle.

Divide the total by the expected lifespan in months to find your true monthly ownership cost. The result often surprises business owners—it reveals which investments deliver the best long-term value.

A Real-World Example

Let’s say a caterer is choosing between two combi ovens:

Oven A looks cheaper initially, but over five years, it costs: £3,000 + (£35 × 60 months) + (£200 × 5 years) - £300 = £6,650 total.

Oven B, over eight years, costs: £4,200 + (£25 × 96 months) + (£100 × 8 years) - £500 = £8,700 total.

When you divide by lifespan, Oven A costs £110 per month, while Oven B costs £90 per month—making Oven B the better long-term investment.

Energy Efficiency and the Long-Term Payoff

Energy-efficient catering equipment isn’t just good for the planet, it’s good for your wallet. Over time, energy bills often exceed the purchase price of the equipment itself. Modern refrigeration, induction cooking, and heat recovery dishwashers all save significantly on utility costs.

Herits helps clients compare efficiency ratings across models, so you can predict real savings. Small daily reductions in energy or water use compound into thousands of pounds saved across a single machine’s life.

Downtime: The Hidden Cost You Can’t Ignore

Unplanned breakdowns are one of the biggest threats to profit. Downtime leads to lost sales, wasted ingredients, and added stress on staff. Factoring this into your TCO ensures your budget reflects real-world conditions.

The formula for downtime cost is simple: (Lost revenue + labour cost) × hours of downtime + repair cost.

Choosing reliable, well-maintained, or refurbished commercial equipment from Herits reduces the risk of breakdowns, which means fewer interruptions and smoother operation.

Maintenance: Small Costs That Save Big

Regular maintenance keeps your TCO low by extending lifespan and preventing major failures. Investing in a scheduled service plan is often cheaper than waiting for something to break. Replacing a £30 gasket today might prevent a £500 repair tomorrow.

Herits supplies clear maintenance documentation with every piece of equipment, making it easy to track care routines and satisfy compliance checks. It’s a simple way to protect your investment and reduce overall ownership costs.

Comparing New and Refurbished Equipment

Refurbished catering equipment offers even greater TCO advantages. Lower purchase prices and proven reliability make refurbished options attractive for SMEs looking to balance cost and performance. At Herits, refurbished units are fully tested, certified, and often come with warranties that rival new models.

When calculating TCO, refurbished equipment consistently delivers lower lifetime costs, particularly for start-ups, expansions, and seasonal businesses.

How Herits Helps You Buy Smarter

Herits goes beyond selling equipment. We partner with our clients to calculate and compare TCO across multiple models, ensuring every purchase delivers measurable value. Our online TCO Calculator and Equipment Scorecard turn data into clarity, giving business owners the confidence to choose wisely.

With these tools, you can:

• Compare lifetime costs instantly. 
• Assess the real ROI of new versus refurbished equipment.
• Find energy-saving opportunities.
• Build stronger business cases for capital investment.

Invest in Value, Not Just Price

Every decision in a professional kitchen affects profit and performance. Understanding total cost of ownership means focusing on longevity, not just savings. The smartest investment is the one that works hard, lasts long, and supports your goals.

Herits is here to help you make that choice, with trusted advice, tested equipment, and transparent value at every step.

Herits: smarter tools, better kitchens, lasting value.