What does an industrial robot really cost over five years?

Set the boundary before entering a price

Define the application being costed: robot, tooling, presentation, machine interfaces, protective equipment and the work needed to produce accepted output. State the production volume, shift pattern and part families assumed over five years. An arm-only quote and an integrated cell budget describe different purchases. Use the existing quotation guide to establish acquisition scope, then carry the agreed items into a dated ownership model.

Choose whether the model shows cash spending, accounting expense or cost per accepted part, and label it accordingly. These views answer different questions. Keep financing, depreciation and tax treatment with the business's finance team rather than mixing them into an unexplained total. Record currency, treatment of taxes and whether future amounts are in today's money or nominal future money. A consistent basis makes later revisions interpretable.

Build a ledger by year and cost driver

Give every cost a description, timing, driver, quantity, unit basis, source and owner. A driver explains why the cost changes: calendar time, operating hours, accepted parts, tool changes or a discrete event. Mark a supplier quotation, measured internal rate and unresolved estimate differently. Do not enter zero for an unknown item; show it as unresolved so an apparently precise total cannot conceal missing scope.

Use a separate row for internal engineering and operator training even when nobody sends an external invoice. Their treatment depends on the chosen cost view, but the required capacity should remain visible. Avoid counting the same effort inside a fixed integration quote and again as a contractor allowance. The table is a model structure, not a list of mandatory charges or an estimate of current prices.

Estimate operation from actual use

Calculate operating labour from the tasks that remain: replenishment, inspection, routine cleaning, changeover and authorised recovery. Distinguish labour required to run the application from labour hypothetically released elsewhere. A person becoming available for another job is a capacity benefit; it becomes a cash saving only when the business can actually change spending. Keep the cost model and the benefit case in separate, linked views.

For electricity and compressed air, request an appropriate measurement or supplier estimate for the whole installation and its duty. Include idle periods where relevant. Tooling consumables should follow measured replacement behaviour or a documented initial assumption. Record software subscriptions and support renewals from the actual terms, including who can change them. Revisit usage assumptions after the pilot so a sales demonstration does not set five years of operating expectations.

Separate planned maintenance from uncertain repair

Build planned maintenance from the applicable equipment documentation and competent maintenance plan, then obtain the labour, parts and access costs. HSE's maintenance guidance emphasises planned work and competent people, which makes maintenance a real ownership activity rather than an optional allowance. Include peripheral equipment such as vacuum generators, fixtures, conveyors and extraction where they belong to the defined application.

Keep unplanned repair in explicit scenarios unless there is a defensible probability model. Ask what the support agreement covers, what needs separate approval and how replacement components would be installed and validated. A warranty may cover an item without covering all associated attendance, transport or production disruption. Avoid treating a percentage of purchase price as a known annual repair bill; label any provisional reserve and explain how it was chosen.

References: Maintenance of work equipment

Model downtime without counting the same loss twice

Estimate the physical consequence of an interruption first: which machine stops, what work can continue and whether orders can be recovered later. Then have the business identify the relevant cost, such as extra shifts, subcontract work or an evidenced lost contribution. Full sales revenue is not automatically the cost of a lost production hour. If the capacity can be recovered within normal operations, the financial consequence may differ.

Check for duplication between availability assumptions and downtime charges. If reduced output already increases the calculated ownership cost per accepted part, adding a separate charge for every missing part may count the same effect again, depending on the decision view. Retain direct repair spending separately from production consequences. Use more than one outage duration where restoration time is uncertain, and show which part of the result depends on that uncertainty.

Work through a cost-index example without inventing prices

Use an index to understand the arithmetic before entering commercial data. Suppose the accepted installed application is assigned 100 cost units, with annual operation and planned maintenance assumed at 12 units for each of five years. Assume a discrete repair event of 15 units in year three and an end-period removal cost of 5 units. With no residual-value credit, the undiscounted total is 100 + 60 + 15 + 5 = 180 units.

These units are invented solely for arithmetic; they are neither currency prices nor a market benchmark. If annual operation becomes 16 units, the total becomes 200. If the repair event is omitted, the original case becomes 165. Keep those scenarios visible instead of averaging them without evidence. Divide each total by its corresponding accepted output when comparing cost per part, and keep the time horizon consistent.

Decide what happens at the end of year five

Year five is a modelling boundary, not an automatic retirement date. Compare continued use, redeployment, sale, refurbishment and disposal where they are credible options. Include decommissioning, qualified disconnection and handling, data management, transport and any site restoration in the chosen exit case. If the equipment remains in use, explain how the model treats its remaining value rather than pretending that the asset disappears.

ABB offers remanufacturing, repair and robot take-back services for its equipment. That establishes possible service routes to investigate, not a residual-value guarantee for your robot. Obtain an actual assessment when the decision becomes concrete. Until then, show a conservative no-sale-credit scenario alongside any evidenced alternative. Do not treat an asking price for an unrelated used robot as cash that your business is certain to receive.

References: Remanufacturing and Workshop Repair

Use the model to make a decision and revise it

Present installed cost, recurring spending, discrete-event exposure and accepted-output assumptions separately. Identify the few inputs that can change the decision: utilisation, attendance, changeover frequency, support scope or a major repair. Test each against a plausible documented range. If a small change reverses the preference, obtain better evidence before committing instead of presenting the base case as a settled forecast.

Ask the finance team to decide whether a discounted comparison is needed and to set a rate consistent with the business's basis and inflation treatment. Keep the undiscounted cash schedule available for budgeting. After commissioning, compare actual spending and accepted production with the model, recording why assumptions changed. The model becomes useful management information when each revision preserves its sources, scope and unresolved questions.

Checklist

• Define the complete application and five-year production assumptions.
• Separate cash spending, accounting treatment and benefits.
• Record cost drivers, timing, source dates and unresolved inputs.
• Include internal attendance, utilities and actual software terms.
• Budget planned maintenance separately from uncertain repair events.
• Check downtime and output calculations for double counting.
• Model continued use or exit without an unsupported resale guarantee.
• Replace pilot assumptions with operating evidence after commissioning.

Common questions