Building Out Your ROI: Making Sure Your Next Furnace Acquisition Makes You Money

Decisions on capital equipment purchases are often based on the cost of the equipment and expected revenue. Although these are important, they do not provide a full financial picture of the value involved. This paper identifies the many aspects of heat treating that impact the value of a furnace purchase. It discusses hidden costs associated with installing, operating, and maintaining new equipment, the effect of depreciation and inflation, and the influence of unevaluated risk. It presents an analysis framework and tools that can help heat treaters not only make better purchasing decisions, but also know what to charge for services to stay competitive and still hit target breakeven timelines.