How to conduct a life cycle costing?
So what are the steps to do a life cycle costing? First, it helps to have a spreadsheet. They can make the calculations a snap, especially if you have one with pre-loaded costs. You need to be able to look at both variable and fixed costs, and look at how the costs change from year to year. You need to have an idea of what the input cost variables will be. Fuel, hangar, maintenance, salaries and other costs may play a significant factor in the calculations. Make sure that you use the same assumptions when comparing different aircraft. You may wish to set up a table showing the options and the costs. A big variable is how long to run the costs.Most businessjets for sale are owned about six to eight years on average before they are sold or traded. For new aircraft, that period gets you to the end of the warranty and close to the first major maintenance check such as a C-Check or an engine mid-life inspection. For a used aircraft, it may get you beyond that next major aircraft or engine c
