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Proposed Major Change to Article

[edit]

I have created an expanded version of this article (see https://en.wikipedia.org/wiki/User:Mgkay/Material_handling) and would like to propose it as the new base article for the topic, from which others can expand it. I am an academic and have taught and done research in material handling for many years. I have tried to make it concise and comprehensive and have included citations for everything in the article. Please let me know your comments regarding the change. Michael G. Kay 19:01, 21 September 2015 (UTC) — Preceding unsigned comment added by Mgkay (talkcontribs)

OR equation

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I made the addition in bold below, but my actual feeling is that this is all too OR to remain here.

A rough guide to determine how much can be spent for automated equipment that would replace one material handler is to consider that, with benefits, the median moving machine operator costs a company $45,432 per year.[1] Assuming a real interest rate of 1.7%[2] and a service life of 5 years[3] with no adoption/adaptation cost, no learning cost, no training cost, and no operating cost for equipment with no salvage value,[4] a company should be willing to pay up to

to purchase automated equipment to replace one worker.[5]

References

  1. ^ $31,530 median wage divided by 0.694, where wages represent 69.4% and benefits 30.6% of total labor cost ("Employer Costs for Employee Compensation". BLS. December 2014. Retrieved 2015-05-15.).
  2. ^ Average U.S. rate from 2005-2009 ("Real interest rate". The World Bank. Retrieved 2015-05-15.).
  3. ^ Average service life of Custom Software ("BEA Depreciation Estimates" (PDF). BEA. 2004. Retrieved 2015-05-15.), conservative assumption since software is a major component of automated equipment and has the shortest service life compared to other components.
  4. ^ Conservative assumption that simplifies the analysis since any positive salvage value would increase the purchase cost estimate.
  5. ^ Amount willing to pay is the present value of an annuity immediate.

All the equation illustrates is a technical handling of an interest rate discount over five years, plus a bunch of numbers "conservatively" plucked.

But I incline to more over less, so I'll leave it for the next editor to decide. — MaxEnt 01:19, 5 January 2022 (UTC)[reply]