INPROFORUM Junior 2012

Case study: total cost of ownership (TCO) model in management of internal logistic processes
Stanislav Koutný

Language: cs
Last modified: 2013-06-21


This case study shows procedure of the analysis and comparison of the opportunity cost in area internal logistics processes in a manufacturing company. Conventional determination of logistics costs as a percentage of the stock prices can complicate decision making between different forms of the logistics process. When a company has to choose between different logistics processes, then can use total cost of ownership approach (TCO). TCO approach means to analyze and compare the alternative processes regardless of the various ways and methods of determining the cost in the various organizational departments. With TCO approach can be detected the potential of internal savings of opportunity costs. With TCO approach can be determined costs generated by changes in logistics processes. Finally, with TCO approach can also be determined influence of logistics processes costs to the total cost of ownership for a specified product for comparison with its potential purchase including parts of logistics services.


TCO, total cost of ownership, logistics processes, production management

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