Life Cycle Costing (LCC)

What is LCC methodology, what is it for and why is it important to know about it

Life Cycle Costing (LCC) is a methodology for assessing the economic performances related to the entire life cycle of a product or service from extraction and processing of raw materials, production, distribution, use, to end of life.
With a view to management for efficient production, the LCC method allows to relate quantitative data related to the costs of a product or service, to gain an overview of the Life Cycle Cost aimed at producing financial, and time, savings within the pre-production, production and decommissioning process.
The ultimate goal is to achieve better economic sustainability of one's product or service.

What is it for

LCC analysis is a valid tool to support company businesses and that allows them to improve the economic sustainability of their products or services. LCC allows companies to:

  • acquire a detailed knowledge of all the sources that contribute to determining the cost of a product or service
  • identify opportunities for financial and time savings within the pre-production, production and disposal process
  • predict the costs to put a new product on the market, from pre-production to its disposal.

Why it is important

LCC analysis helps companies to:

  • estimate, in monetary terms, the direct and indirect costs of their resources
  • reduce production costs to a minimum
  • make precise and conscious budget planning
  • make much more informed purchasing decisions

Some of the costs quantified by LCC:

  • Purchase cost
  • Maintenance and repair cost
  • Water consumption
  • Energy consumption
  • Replacement cost-residual value
  • Disposal cost
  • Intangible assets of a company (patents, brand and reputation)

What we can do for you

We follow you in the evaluation process through:

The tool for automated LCC 

If you need to perform LCC analysis for multiple products or services, in an automated and rapid manner, learn more about EcoOptimal LCC. The tool was designed by the Project HUB-360 team to be a true optimization tool, capable of performing LCC analysis in minutes.