Total value of ownership is making its mark in the justification of automated systems

Source: Material Handling Industry of America

Oct 02, 2009

Integrated Systems and Controls (ISC) Industry Group of Material Handling Industry of America (MHIA) has released it's fall 2009 quarterly report titled A New Look at Automated Material Handling’s Return on Investment. The report asserts that total value of ownership (TVO) is making its mark in the justification of automated systems.

By focusing on technology’s value, companies realize how a capital investment will reduce direct labor, and enable process, technology, and service innovations to the benefit of their customers.

That said, there is a shift underway in evaluating systems. Total cost of ownership (TCO) has been a prominent factor. However, Beumer’s John Sarinick, chairman of the Integrated Systems and Controls (ISC) Council of Material Handling Industry of America (MHIA), says “total value of ownership (TVO) is supplementing TCO in the ROI formula.”

Sarinick points out that more and more businesses are building large regional distribution centers in urban and exurban areas to take advantage of lower costs for land and construction, and to capture lucrative tax incentives.

To view the complete report, visit www.mhia.org/subwebs/emails/images/iscqrfall2009.pdf.

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