Anticipating maintenance expenses for the coming year helps to manage your costs and implement an effective preventive maintenance plan.
There are several additional benefits of good operating budget planning that includes preventive maintenance:
- Aligns maintenance activity with your organizational mission
- Shapes your facility’s annual financial outlook and the role of maintenance in that outlook
- Encourages an in-depth look at facilities to identify areas of greatest need
- May coincide with an equipment assessment to maintain up-to-date capabilities
- Helps to identify cost-cutting opportunities
- Can include a personnel review to ensure that you’re working with the best professionals to provide the maintenance you need
Maintenance budgeting involves planning for routine care, determining upcoming capital expenses and examining the life cycle of your most costly assets.
It’s also a good idea to put a contingency fund in place so you’re prepared to deal with the unexpected, and reassess your budget throughout the year in response to changing circumstances.
In addition, your maintenance service providers can provide insights to guide the budgeting process and manage day-to-day implementation of your maintenance plan.
A good place to start is to talk with service providers about including expected maintenance costs in your operating and capital budgets.
Operating expenses are used for day-to-day upkeep, but forecasting annual maintenance costs can be a tricky endeavor.
A trusted service provider should be willing to sit down and help you assemble a proposed budget and can often provide accurate estimates based on their past experience with other properties that have similar conditions.
This helps you to anticipate wear and tear on your building and estimate the corresponding maintenance that will be required to enhance the safety, functionality and aesthetic appeal of your facility for customers and employees alike.
Many factors go into projecting your operating maintenance needs:
- General use of the space
- Estimated foot traffic
- Environmental conditions
- Types of finishes used on assets
Capital expenses, on the other hand, are funds specifically set aside to purchase, upgrade or extend the life of physical assets like equipment, vehicles, and properties.
Large renovation projects or project undertaken to extend the useful life of a building would fall under this category.
Emergency repairs can often not be predicted, which is where a contingency fund can help.
However, other large projects are easier to tackle when they are planned and budgeted for ahead of time. This helps you to select the right service provider for each part of the process and get the most value for the money you spend on the project.
Work with Service Providers to Make the Most of Your Maintenance Budget
When you’re working on your annual budgeting process, reach out to your trusted service providers for an accurate estimate of expenses so you can be prepared for the year ahead.
As you transition from one fiscal year to another, a trusted service provider can also help you make the most of your remaining budget.
Flexible scheduling and invoicing programs are critical components to many operating and capital projects, and a reputable service provider will be happy to provide a set of options to suit your needs.
Are you looking for guidance on maintenance budgeting for the coming year?
Contact us at Mid America Metals. We’ll assess your needs and help you invest in the right services to keep your facility in excellent condition for years to come.