5 effective ways to save money through preventive maintenance

Preventive maintenance is often seen by companies as an unnecessary expense that is a waste of time and resources. In most cases, this is far from the truth and can turn out to be a very expensive mistake. Companies tend to focus exclusively on the immediate problems that arise – repairing or replacing parts when something goes wrong in operations, as well as reacting only to urgent problems.
While this form of corrective maintenance is necessary for some situations, switching to preventive maintenance is a strategy that will save time and money and help your operations run better. For many organizations, maintenance management can represent almost half of the operational budget. According to ReliabilityWeb, the equipment can increase its reliability from 35% to 50% after implementing an effective CMMS system. Additionally, improving ticket/work order management can increase savings by 5-15 percent, and inventory optimization can reduce costs by another 20 percent.
Moving from reactive to preventive maintenance can be a smooth transition with the right preventive maintenance software. In this article, we'll take a closer look at preventive maintenance, focusing on identifying 5 ways a business or other organization can save money in the long run.

What is preventive maintenance?

Preventive maintenance is not about fixing problems. Its objective is to prevent these problems from ever happening. Includes activities such as cleaning, lubrication, adjustments, repairs, and replacement of parts. Each of these activities is performed to keep the equipment operating at peak conditions and to prevent downtime and reactive maintenance.

Preventive maintenance software is available to facilitate a good preventive maintenance plan. Instead of having to track maintenance interventions on paper, all data can be entered into a preventive maintenance software program, which then regularly schedules all preventive maintenance tasks and agendas.

With preventive maintenance software, you can organize tasks, record maintenance information and keep everything centralized.

5 effective ways to save money through preventive maintenance

Now that you understand how preventive maintenance differs from reactive maintenance, it's time to talk about the benefits of this new system and how it can save your company money.

  1. Reduced downtime

When it comes to manufacturing, the phrase "time is money" is true. Every time machinery is shut down for maintenance, you lose money in both employee wages (since the workers have to wait for the equipment to be repaired) and products (which cannot be made when the equipment is shut down). Preventive maintenance reduces downtime because the whole purpose is to prevent downtime.

  1. Increased operational efficiency

When preventive maintenance is properly implemented, the equipment is maintained through a routine process so that it can run in an optimal condition at all times. When machines work more efficiently, they don't have to use as much energy and resources. This means cost savings as well as improving the environmental footprint.

  1. Reducing high costs with corrective maintenance

Corrective maintenance is incredibly expensive. When something breaks unexpectedly, you have the costs of your maintenance team (which may include paying overtime), the cost of the extra time it takes to diagnose the problem, and the cost of parts (which may include expedited shipping). Preventive maintenance can dramatically reduce the risk of these costs. Using preventive maintenance software, your team will perform routine checks and scheduled maintenance at convenient times, steps that help you avoid major and expensive fixes.

  1. Increases the life of the equipment

In addition to reducing downtime and expensive repairs, preventive maintenance will also increase the life of your equipment. When everything is up to date and working properly, you'll maximize the life of your machinery, helping you get the most out of the investment. We also recommend reading IoT-Based Predictive Maintenance and Vibration monitoring.

  1. Improve customer service

Your customers put their trust in the products or services you offer. They are expected to be delivered on time and no one wants to hear that products will be delayed due to machine breakdowns. When you can consistently provide quality, on-time customer service, you'll have happier customers, better reviews, more referrals, and ultimately, more sales.

Implementation of a preventive maintenance program

If you've been relying on corrective maintenance but want a solution that will save you money, time, and effort, it's time to turn to preventive maintenance. While there are some upfront costs to get started, you'll end up saving a lot in the long run.

The best way to start a preventive maintenance plan is to first research your maintenance software options. When you choose the right preventive maintenance software for your business, the transition will be quick and easy.

You also don't have to worry about the complete transition from corrective maintenance to preventive maintenance because maintenance software handles both types. After you implement preventive maintenance software, you can work on setting up equipment one by one on a preventive maintenance schedule. That way, you won't be overwhelmed and can work at your own pace.

As you can see, preventive maintenance offers many important advantages, but the most important is that it can improve your ROI (Return on Investment). Make the switch today and you'll see that the cost savings will start to add up quickly for your organization.

ROI Method 1 – Classic maintenance

If you have an idea of maintenance expenses (including any combination of equipment, inventory, downtime, overtime, or overall cost), the formula is relatively easy.

The example is calculated for 3 years. Annual maintenance budgets are $400,000 or $1,200,000 over the 3 years. The cost of the software over this 3-year period in this example is $9,150.

Annual percentage improvement estimates are 2%, 4%, and 7% based on the assumption that improvements increase through better use of maintenance software.

With these percentages of improvement, the company will reach a 368% ROI and payback in just 2.56 months.

The maintenance management system can do this by reducing labor/overtime, improving inventory control, reducing equipment replacement/repairs, etc. These are possible through good system implementation.

ROI Method 2 – Reduced downtime

The key to this model is to calculate the average cost per hour when a piece of equipment is down. For example – if you make a product and the machine that makes it breaks down, you can no longer make that product.

And you probably pay someone to monitor this equipment – even if it doesn't work. You also have costs with the technician who has to work to repair that machine. Parts may be required to repair the fault.

You also have lost production costs and if you can calculate an estimated hourly cost associated with the downtime, this model can work great.

For example – you have 10 pieces of production equipment, each running 15 hours a day. Historically, equipment is down 5% of the time. When the equipment is down, you spend $100 per hour (downtime per hour).

For this example, the cost of the CMMS software is $5,000.

Using this data, if you can reduce downtime from 5% to 4.5%—approximately 10 percent reduction from current downtime levels—the ROI after one year is $22,375.

This is a profit over the cost of the software. If you could reduce your daily downtime to 3.75%, the cost savings would be $63,438 per year.

It follows that by using a good CMMS, you can improve equipment operational efficiency, reduce inventory costs, reduce overtime, reduce downtime, and have a more efficient maintenance team.

The operational advantages of a CMMS are great, and what's more, a properly implemented CMMS can go a long way in reducing costs – you'll be able to save significant amounts saved from repairs and shutdown costs directly related to actual production.

QLEAP KMR – Keep the Machine Running is software that helps you plan and organize maintenance activities.

QLEAP KMR comes to the aid of users because the web platform in which it was designed supports factory-specific modifications and adjustments. The core of the software is represented by the three general types of maintenance:

  • Corrective/accidental maintenance involves the recording of all reported malfunctions at the machine level. They can be entered directly, breakdown or an approval flow is followed: failure notification, approval-qualification-allocation technician, maintenance solution.
  • Preventive / planned maintenance is carried out according to the maintenance plan and the frequency of interventions. For each piece of equipment, the maintenance list is configured according to the periodicity.
  • Predictive maintenance: the IoT functionalities take parameters from vibration sensors, temperature, flow, etc. which are configured with a reference range, so that if a recorded value does not fall within the range, the application can schedule maintenance or send SMS and/or e-mail. Taking the operating hours directly from the machine helps to plan the preventive maintenance established according to the cyclicity (operating hours).
Do you want to implement an effective preventive maintenance plan for your organization? Analyze the functions offered by the KMR – Keep the Machine Running solution and find out the information flow of the maintenance process directly in the application.