Total Cost of Ownership (TCO), which is the total cost associated with the purchase, use, maintenance and ultimate disposal of a product.

TCO takes into account all the hidden costs associated with owning and using a product or service, not just the purchase price.

TCO is key in purchasing management as it allows for a more accurate comparison of suppliers, the development of a value-focused purchasing strategy and the creation of long-term partnerships rather than just negotiating price.