What are Two Extra Years Worth?
Equipment preventive maintenance offers many valuable benefits for a practice. It eliminates equipment emergencies and lost production. It removes nuisances that annoy the dental team and robs the office of efficient operation. And it plays the key role in extending equipment life. But what is extended equipment life worth and how much should you pay to get it?
A Helpful Example
Here is an example to help you think about the value of just a couple of extra years from your equipment.
Start by looking at equipment from a cost per day perspective. This helps an office develop a ratio that compares the daily cost of equipment to the daily production it helps create. It is relatively simple to calculate -- just divide the purchase price by the expected life in days.
EX: A $6000 piece of equipment is expected to last 6 years or 1080 days (based on 180 clinical days in a year). The cost per day is $5.55.
What if you can extend that piece of equipment’s life by two years through good preventive maintenance? Several studies show good preventive maintenance doubles equipment life but let's be conservative and increase it by only 33%.
EX: A $6000 piece of equipment with preventive maintenance is now expected to last 8 years or 1440 days. The cost per day is $4.16. You lowered your cost per day by $1.39.
Now take this example and apply it across an entire office with $240,000 worth of equipment (40 times the example). You save $55.60 ($1.39 x 40) per day. In a year with 180 clinical days, this lowers your cost per year by $10,008 ($55.60 x 180).
How Much to Spend
So, what would you be willing to invest to lower your cost by $55.60 per day or a little more than $10,000 in a year? Your accountant would likely tell you anything less than this amount makes financial sense. Fortunately, you will not spend $9,999 a year to get good preventive maintenance. Four to six hours of proactive care per year is all that is needed, and it should only cost about $600 - $850 in labor.
Preventive maintenance plays a critical role in getting the most out of your equipment investment. It eliminates emergencies and lost production. It removes nuisances and frustrations. And it extends equipment life, allowing your office to keep equipment costs per day as low as possible.
Reach has been providing preventive maintenance service, Reach Recare, to our clients since our inception. It is not a contract program but rather a decision our clients make to schedule the next Recare appointment in six months – just like hygiene recare. To learn more about Reach and our preventive maintenance program visit reachforservice.com/reach-recare.