Do Economy lubricants save you money?
Cheaper lubricants can offer short-term cost savings, but are they the right choice overall? Our Spotlight on Shell Experts series explores why customers need to pick the right product for each application if they want to reduce TCO and downtime.
By Shell on Jun 29, 2021
Seven specialists from Shell's Lubricants division were on hand to deliver their tips and tricks. From Scott Kwas, Gary Roberts, Siva Kasturi, Greg Paluska, Praveen Nagpal, Robert Profilet and Raghavendran Madhavarao, here is what you need to know to get the best from your machines and the best for your business.
Economies don’t have to be in difficulty for companies to want to find cost savings, especially when it comes to economy vs premium lubricants. Most would argue it’s simply good business sense.
The challenges come when things that look like good value turn out to be costlier in the long run. These false economies can be a burden on business and are often hard to put right.
Shell’s Global Product Application Specialist, Praveen Nagpal explains: “Unplanned stoppages are critical. Historically, the customer has had the mindset of defaulting to the cheapest supplier. But they’ve come to realise that’s never been a good solution. A higher number of failures, oil changes and unplanned stoppages means the initial investment was less but now there are plenty more losses on top.”
Often, overspending isn’t picked up until a great deal of time has passed. In some cases, it can even go unnoticed altogether, masked by any number of contributing factors.
Choice of lubricant is key
One of the biggest opportunities for falling into the false economy trap is in choice of lubricant. As manufacturer and supplier technologies have progressed, there can be a dizzying array of lubricant choices covering a range of price points.
Shell’s Eastern US Technical Manager Greg Paluska explains: “There is still the hurdle where some of our customers say – yes these fluids are more expensive – there’s a reason for that – they’re harder to manufacture. But the advantages and whole cost of ownership store is pretty dramatic. Cost of oil is only one factor.”
Cheaper lubricants have their place – but they are also, in most cases, only a short-term saving. The right lubricants which can be, if necessary, premium lubricants, are important when reducing machine downtime, TCO and developing total productive maintenance.
Nagpal says: “If the application needs a mainstream product and you still push for a premium product, it can definitely increase your total cost of ownership. Proposals need to be aligned with customer need.”
You’ve got to look at the bigger picture. We have a lot of customers who are very sophisticated and do just that but there are also a lot who say ‘Hey, cheaper is better. It’s just oil. It just needs to be slippery’. Equally, they’ll say ‘My equipment leaks a lot, why put something really expensive in it?’ Well, if your equipment leaks a lot, you still need to protect the parts because otherwise it’ll leak a whole lot more,
Education is critical.
The answer to these issues is two-fold: One, it pays to choose a lubricant that is specifically designed for the engine, pump or gear workings it supplies – which helps manage maintenance cycles. Two, choose a premium lubricant where possible and appropriate:
“Customers’ general view is that lubricants are just an industrial consumable. It’s in constant need of replacement. It is also only a small part of the overall maintenance budget, typically 2%-3%. So it doesn’t take up much of the customer’s consideration. But also, they’re not aware how that 3% can have a bigger knock-on effect further down the line.”
Raghavendran Madhavarao, Sector Marketing Manager for Shell concludes. “They sometimes can’t believe lubricants play such a big role in the total cost of ownership. It’s up to us to help them understand more.”
