The situation is easy to picture: a foodservice operator looks at a broken piece of equipment and asks the question “should I call someone to fix this or just replace it entirely?” The answer is not always straightforward, as many factors should go into determining when to repair and when to replace.
Here are a few questions that can assist operators in making the right decision for their kitchens:
Is there a newer model available?
Newer models may present an opportunity to upgrade to a piece of equipment that provides long-term benefits to the operation.
In fact, by keeping an older generation product, operators could be losing out on features and benefits such as increased energy efficiency, easier cleaning or reduced daily maintenance, and faster results — which all impact the overall cost of the equipment. While some operations might pride themselves on holding onto equipment for decades, the hidden costs of keeping this equipment might be negating any upside.
For example, new equipment can also save on food costs. With the high quality toast provided by new generation Antunes toasters, quick service chains may be able to eliminate the need to butter buns, decreasing their food expenses.
Is the operation adding a new menu item or daypart?
When there is a significant operational change, such as extending or adding a daypart, or even a smaller scale change, such as adding a new menu item, the existing equipment may no longer meet the operation’s needs. Operators should consider the versatility of existing equipment and the opportunities presented by new equipment, such as a toaster that can accommodate a variety of bread products, in order to decide the best way to address these menu and operational changes.
New equipment can also streamline operations and remove unnecessary units from the restaurant. For one customer offering all day breakfast, if they use the previous toaster, they also need to use a separate muffin toaster. With Antunes’ new toasting system, the muffin toaster is no longer needed — freeing up counter space and reducing energy costs.
How old is the piece of equipment?
When the piece of malfunctioning equipment is relatively new, it may be advisable to simply pay for the repairs since the equipment likely has many years of service left. Older equipment is more likely to be less energy efficient, less versatile and incur greater operating costs.
Additionally, purchasing a new piece of equipment comes with a new warranty, which can save operators from shelling out funds for costly repairs.
What is the condition of the piece of equipment?
If the equipment has been in use for a long time and is showing signs of wear and tear, replacement should be considered. Beyond just aesthetics, if the unit is performing poorly or taking longer to operate, the food quality and operational efficiency could be impacted as well.
What are the associated costs with either scenario?
The decision to repair or replace equipment should be based on minimizing the total cost of the equipment to the business over its remaining lifetime. Factors in this calculation include:
- Maintenance costs over the remaining service life of the equipment
- Immediate and ongoing costs to service the equipment
- Cost of unscheduled downtime during repair or replacement
- Cost of the replacement equipment, accounting for any rebates or incentives
- Installation cost of the replacement equipment
Additional consideration should be given to factors that affect the overall operation:
- Training cost on the replacement equipment
- Productivity gain or loss of the replacement equipment
- Increased or decreased efficiencies from the replaced equipment
- Additional opportunity costs associated with either decision
Analyzing all of these factors and translating them into dollars gives a better “apples to apples” comparison between repairing and replacing a piece of equipment.
Overall, if equipment requires extensive upkeep, the repair fees may actually outweigh the replacement fees. A new piece of machinery may appear more costly initially, but it could actually be the least expensive option in the long run.
With an eye toward future replacement opportunities and ongoing service and maintenance needs, operators can plan ahead and avoid emergency situations where they must quickly determine whether to repair or replace.
Additionally, working with the equipment manufacturers to understand the anticipated life of the equipment and to stay informed about new product enhancements or features of new models, operators can make informed decisions that will benefit their operations long-term.
See how proper cleaning techniques can help extend the life of equipment in this article.