FedEx and the Life-Cycle Cost

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FedEx and the Life-Cycle Cost Life Cycle Costing Life Cycle Cost (LCC) is the total lifespan cost incurred by an organization in purchasing, installing, operating, maintaining, and disposing off any equipment used in daily operations of the firm. In regard to this, estimation of LCC encompasses using a particular approach in identifying and quantifying components of an LCC equation (Pehnt, 2006). The use of LCC as an assessment tool when selecting possible design alternatives results in the provision of a cost-effective solution within limits of available data. In addition, a standard LCC comprises initial and operation costs, installation and commissioning costs, energy costs as well as disposal costs among others. System Requirements The management of FedEx gives particular emphasis on the initial purchasing and installation cost of new systems. In line with this, the firm's top managers are supposed to explain LCC of various solutions prior to the installation of new equipment. The initiation of strong LCC is essential in assisting FedEx achieve high financial strategies in the competitive market. Therefore, to maintain a competitive edge, the organization constantly initiates cost savings to improve its profitability (Hsu, 2012). Life Cycle Cost Analysis Before conducting the LCC analysis for the firm's facilities, an evaluation of the entire set of alternative systems is required. In this situation, lifetime energy and maintenance costs take a greater

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