Product Life Cycle Cost - Benefit Model And Its Application Cases

Traditional concept of cost is always restricted in certain aspect of manufacture or commercial operation, but seldom covers through product's whole life span. This often leads to consumer's emphasis only on reducing the purchase price while ordering product. However, many domestic and international application facts show that product's maintaining costs (operation cost, energy cost and maintenance cost, etc) are often much higher than its original purchase price. So one might make wrong purchase decision if he fails to consider the total costs within product's life cycle (i.e LCC).As for a investment project of product operation, one should not only consider LCC, but also the whole income within product's life cycle(i.e LCI). Only after the above two factors are considered together to make specific project financial evaluation, can the benefit level of project operation be foreseen and the right investment decision be made.Via setting applicable mathematic models and with the applicable tool of computer, one can quickly acquire specific LCC, LCI & investment beneficial indexes, so that he can make right purchase decision on concrete bases. Three application cases are presented to show the step and method of using the models.Study shows that at nowadays time when energy saving and resource saving arise global concerns, limited resources can be exploited to maximum extent during process of sustaining development via making right purchase decision based on analysis of LCC & LCI. So this study can be referred to increase domestic enterprise's economic benefits.