Build a TCO Case for Facilities Services
Create a total-cost comparison for category supplier selection.
A lower labor-rate supplier appears cheaper, but the scope excludes cost buckets the site will still pay. TCO comparison: base price + operating cost + quality cost + admin burden + risk cost. Common trap: comparing supplier hourly rates when suppliers have different inclusions, exclusions, and operating assumptions. Before Supplier A: $28/hour and 11% lower than Supplier B. Recommendation: choose A. After Supplier A: lower rate but higher consumables, rush fees, rework, and invoice handling. Supplier B: 4% lower total cost and lower operating risk. 1. Normalize scope List what each supplier includes: labor, consumables, equipment, supervision, emergency response, reporting,…
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