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Poole College of Management 
Supply Chain Resource Cooperative

Total Cost of Ownership (TCO)

January 20, 2011

In supply chain management, the total cost of ownership of the supply delivery system is the sum of all the costs associated with every activity of the supply stream. The main insight that TCO offers to the supply chain manager is the understanding that the acquisition cost is often a very small portion of the total cost of ownership.

Source: http://www.apics.org/ (10th ed.)