The FM Challenge

But these analyses are not always accurate because of the costs associated with manufacturing or, more accurately, the total cost of operation (TCO). An accurate TCO includes everything—floor space, rush charges, utilities, delivery costs, taxes, etc. If, for example, the in-plant does not pay for floor space, utilities, or delivery, how can it accurately be compared to a company that does pay for those things? In many cases, not including those costs makes the in-plant's costs appear lower, and some people argue that you need to add those calculations to a true TCO.