As we enter the last few weeks of 2020, facility managers are beginning to consider their plans and goals for next year. While maintenance budgeting may not be first on the list when planning for the new year, it is a vital aspect of your facility’s overall performance. Planning for preventative repairs, upgrades to new equipment, and emergency services will help you maintain a high-performing facility in 2021.
MaintenX helps customers create affordable preventative maintenance plans for the year. We emphasize the importance of preventative care for major systems in order to reduce reactive and emergency maintenance costs. In order to do that, we use these budgeting tools to plan your maintenance services accordingly:
In maintenance, your equipment and systems set the budget rather than your staff. For each appliance or major system, you will need to budget for certain repairs and maintenance services based on its service life and service history. These factors will determine the maintenance budget needed based on work hours, replacement parts, and routine services needed to maintain system performance. This budgeting tactic builds from the bottom up and reduces unnecessary service calls.
Replacement Asset Value Percentage (%RAV)
You can also budget using the %RAV. This number, representing the cost of maintenance as a percentage of the cost to replace the entire system, can help you determine when new equipment is needed. Typically, %RAV hovers between 2-5%, meaning that annual maintenance costs shouldn’t exceed 5% of the total cost to replace and install a new system. This ensures that you’re not spending more on maintenance in a given year than you would to finance a new system. However, the %RAV does not give you the entire picture. You must look at your facility’s needs, and the service history of equipment before deciding to upgrade.
Cost estimates based on the previous year
Analyze your 2020 maintenance expenditures to help you see the trends in your facility performance. It’s important to take into account changes you made due to COVID-19, such as shutdowns or increased cleaning and sanitization. These factors are not likely to reoccur in the same way, but they can help you adjust your emergency maintenance budget for 2021.
These are just a few ways in which we recommend you plan your maintenance budget each year. There are countless ways to factor in potential expenses and annual costs, but one of the best is to talk to your local MaintenX team.
MaintenX specializes in preventative maintenance for commercial facilities. We help you care for your facility systems and staff with performance-enhancing and cost-saving maintenance services. To learn more about what MaintenX can do for your business, contact us.