Issue link: http://read.uberflip.com/i/726594
36 / SEPTEMBER.OCTOBER.2016 RINKMAGAZINE.COM SO, WHAT'S IT WORTH? Is your rink the same as everyone else's? Yes, but no…. right? So, it depends. There is a law of diminishing returns in application of cost integration. So striking the custom balance for your facility is the key to unlocking this potential. Typically three approaches for financing cost integration can be pursued. In all cases, there is investment to save. The mental paradox this presents is the single most common barrier to proceeding with cost integration, and unfortunately it's the ultimate reason so much potential is unrealized. Let's face it, if we were to spend money on everything placed in our line if sight we'd all be bankrupt. But it's considering this as "new dollars" that is the singular biggest misconception preventing the achievement of improved sustainability. Cost integration, done correctly, reduces overall costs by reallocating money already being spent on existing budgets. It's not new spending, it's smarter spending. Just as retail giants will put great amounts of effort into helping their suppliers be more cost-effective in their production so these cost-concessions can be passed onto the end purchaser, so should our approach to utility spending be altered. Altering or augmenting the existing equipment to provide cost integration is best accomplished by reallocating existing budget dollars to permanently reduce spending. So during the time spent reading this article on cost integration, pause to consider the missed opportunity to cut costs. Every delay in embarking on a cost integration activity is continued unnecessary spending. J NO ACTION , Also called the cost of inaction. A very real cost, incurred by not pursuing economical options when they are available. Based on a typical twin-sheet facility in the U.S., the lost potential can get as high as $1.2 million dollars over the equipment's useful life. That is over $1 million in utility spending that is avoidable. REVOLVING FUND , A small 'seed' capital investment for an inexpensive high-return project, and the savings finance the next project, in a sort of "domino effect." This method takes a long time to complete all upgrades and accumulate savings. Based on the same twin-sheet facility, a modest savings accumulation of over $150,000 during the equipment lifecycle (including paying for the equipment) and rates of return in excess of up to 40 percent. While extremely modest, when compared to the large "minus" numbers of inaction, this is a dramatic improvement. FINANCING , Because time wasted is missed opportunity to reduce spending, financing upgrades gets cost reduction dollars leveraged now, immediately leveraging the cash flow this will generate (and use to pay for the upgrade itself). In all cases, this accumulates the greatest savings over the 15-year horizon ($520,000 to the positive) with rates of return of up to 74 percent. The Options for Managing This Cost Integration Budget Reallocation Are: