Total cost of ownership

Costs and revenues

Suppliers build financial resources to invest in capabilities and facilities, and to take risks.

Customers determine (if possible) the value of key functions in a process such as R&D, implementation or maintenance and ask suppliers to develop these functions for a target price including agreements on price erosion.

It is difficult to determine the value of a new collaboration. Therefore, the Total Cost of Ownership must be described. Shifts in costs and benefits will occur. If suppliers start performing activities that the customer used to do itself, costs will shift. It is also expected that benefits will occur more quickly as a result of the new collaboration. How exactly this works can be calculated. Let us know if you want to know more.