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Total Cost of Ownership (TCO) and Fastening

It’s important to us here at Bossard to be transparent in all that we do. The purpose of this blog is to outline the total cost of ownership (TCO) in fastening. An individual fastener isn’t responsible for its total cost. There’s a lot that goes into the production of the parts and that’s where the majority of that cost comes from.

We best explain this when referring to something we like to call “The Rule of 15-85.” Those numbers represent the percentages of costs that go into a fastener.

85 percent of costs come from the development, procurement, testing, inventories, assembly and logistics. We call this 85 percent the “invisible costs” because they aren’t visible to our consumers. You all don’t see the work that’s occurring beyond the finished product which you purchase.

The remaining 15 percent of the costs come from the fastener itself. This is also referred to as the “visible cost.”

Another way to think of the TCO is what we call the “iceberg model.” The tip of the iceberg pokes out of the water and is visible, so that’s the 15 percent. The remaining 85 percent is the rest of the iceberg which is hidden beneath the water.

Every solution Bossard creates is designed to reduce costs, according to the TCO concept. Our partners and Bossard work efficiently so you can do the same—cost savings of 50 percent and more can be achieved in the areas of logistics and engineering. These savings have a lasting effect on the cost of the products, which give our customers the best value out there.

Bossard wants to answer any questions you may have about production, total cost of ownership, or about our products. Contact us anytime at ProvenProductivity@bossard.com and subscribe to our blog to learn more about our company!


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April 08, 2016
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