Capital Expendure Requests

[Mr POD]

Can't use tradional payback methods try this :

Quote from the capex justification I'm working on:

In 2008 it would NOT be acceptable to introduce any machine with the safety and control system these machines were originally supplied with, and having had the machine’s deficiencies pointed out by the HSE it would be foolhardy to make no improvements at all.

Typical cases where companies were found to be deficient by the HSE include the following:

http://www.hse.gov.uk/prosecutions/case/case_detai...

I can justify my £80K spend to improve 6 machines, £16K on another machine and £20K on another by scaring the MD that he might go to jail

Edited to add some K's

Edited by Mr POD on Thursday 3rd July 13:50

[Golfman]

Another reason manufacturing is all going to Asia...

[Pot Bellied Fool]

He's wanting you to justify a spend of £80? Ouch.

If it's a reasonably sized place can that not just come out of the machine maintenance budget?

(I worked for an MD like that too - multinational with about £10M t/o and I still had to justify why I needed a tow-hitch on my company car (for biz use) as the 'fleet manager' (girl with jumped up title, a sweet wrapper in the car lost you bonus but no check as to whether you ever checked the oil. Grrr..) wasn't allowed to authorise the £80 or so that was needed...

But yes, I'd say that mentioning HSE should get his attention



Ah yes, now I've seen the extra 'k' that makes a lot more sense. In which case, look at the cost (in terms of lost production & stopping the line) if there's an incident, the cost in terms of fines & compensation and see if you can find a %age likelihood of there being an incident every x years.

...and then there's the moral/legal implications too. Being Swedish do they take such things extra seriously or is it just lipservice? i.e, what's the organisational culture like?

Edited by Pot Bellied Fool on Thursday 3rd July 14:40

[Eric Mc]

Tell him that he might be eligible for a 100% Capital Allowance on this expenditure as well

This is available to small businesses and is available up to a maximum of £50,000 Plant and Machinetry expenditure in the year.

[Mr POD]

Golfman said:

Another reason manufacturing is all going to Asia...

I wonder if the Chinese approach to machine safety is a good thing? Basically if you hurt yourself they sack you.

[Mr POD]

Eric Mc said:

Tell him that he might be eligible for a 100% Capital Allowance on this expenditure as well

This is available to small businesses and is available up to a maximum of £50,000 Plant and Machinetry expenditure in the year.

I'll leave that to the Finance Manager - we are part of massive Swedish company (26K employees world wide)

[Eric Mc]

Sounds like you're too big for that one then.

[srebbe64]

Mr POD said:

Can't use tradional payback methods try this :

Quote from the capex justification I'm working on:

In 2008 it would NOT be acceptable to introduce any machine with the safety and control system these machines were originally supplied with, and having had the machine’s deficiencies pointed out by the HSE it would be foolhardy to make no improvements at all.

Typical cases where companies were found to be deficient by the HSE include the following:

http://www.hse.gov.uk/prosecutions/case/case_detai...

I can justify my £80K spend to improve 6 machines, £16K on another machine and £20K on another by scaring the MD that he might go to jail

Edited to add some K's

Edited by Mr POD on Thursday 3rd July 13:50

If jail doesn't freighten him (and it should) then make a rough calculation of what the cost might be of:

Being sued by the family of the person;
Lost reputation (and therefore sales);
The cost of redundancies should the above happen;
The cost of the PR to return to current status;

The above would come to a hell of a lot more than £80k I've no doubt.

[Golfman]

Mr POD said:

Golfman said:

Another reason manufacturing is all going to Asia...

I wonder if the Chinese approach to machine safety is a good thing? Basically if you hurt yourself they sack you.

No they dont.