To find out which option really costs less, you need to compare:
- the device's upfront price;
- the price of each refill;
- how often you use it;
- the total cost over time.
Quick answer
A pricier device can be worth it when it uses cheaper refills. To find out when that happens, calculate the break-even point:
Difference between the device prices ÷ daily savings on refills = number of days to recover the difference
After that period, the option with the cheaper refill starts generating real savings.
Concepts used: cost per use and break-even point
This calculator combines the cost per use with break-even analysis. First, it calculates how much each refill used costs. Then, it compares that difference with the initial price of the devices to estimate after how many uses the option that costs more upfront becomes the one with the lowest cumulative cost.
Example: which coffee machine costs less over time?
Imagine two pod coffee machines:
- Machine A: costs $1,200.00
- Machine B: costs $3,600.00
Looking only at the price of the machines, option A seems far more economical. However, we also need to compare the price of the pods:
- Pod for machine A: costs $12.00
- Pod for machine B: costs $5.00
Consider a person who drinks two coffees a day.
How much is spent on pods per day?
Machine A:
2 coffees × $12.00 = $24.00 per day
Machine B:
2 coffees × $5.00 = $10.00 per day
(The prices used in these examples are illustrative)
Machine B gives you a daily saving of:
$24.00 − $10.00 = $14.00 per day
How long does it take for the pricier machine to pay for itself?
The difference between the prices of the two machines is:
$3,600.00 − $1,200.00 = $2,400.00
Since machine B saves $14.00 per day on pods:
$2,400.00 ÷ $14.00 = 171.4 days
Comparison result
If you keep drinking two coffees a day, machine B recovers the price difference in about 172 days, or roughly six months.
This moment is called the break-even point. Until then, machine A has the lowest accumulated cost. After it, machine B becomes the more economical option because it uses cheaper pods.
How much does each machine cost in the first year?
Assuming 365 days of use and two coffees a day:
Machine A
- Machine price: $1,200.00
- Yearly spending on pods: $24.00 × 365 = $8,760.00
- Total cost in the first year: $9,960.00
Machine B
- Machine price: $3,600.00
- Yearly spending on pods: $10.00 × 365 = $3,650.00
- Total cost in the first year: $7,250.00
First-year savings
$9,960.00 − $7,250.00 = $2,710.00
Even though it costs $2,400.00 more at the time of purchase, machine B saves you $2,710.00 in the very first year.
From the second year on, once the machines' upfront prices have already been paid, the yearly difference in pod spending would be:
$8,760.00 − $3,650.00 = $5,110.00 per year
How do you calculate the total cost of a device with refills?
Use this formula:
Total cost = device price + spending on refills over the period
To calculate the spending on refills:
Price of each refill × quantity used = total spending on refills
To find the break-even point:
Difference between the device prices ÷ savings per period = time needed to recover the difference
The savings can be calculated per day, week, month or year. Just use the same unit of time throughout the comparison.
Does this calculation work for other products too?
Yes. The same reasoning can be applied to different products that create recurring expenses:
- printers and ink cartridges;
- coffee machines and pods;
- razors and blades;
- water purifiers and filters;
- electric toothbrushes and replacement heads;
- devices that use batteries;
- cars and fuel cost per kilometer.
In all of these cases, the price tag is only the initial cost. The real cost also depends on how much you will spend to keep using the product.
Device and consumable: the “razor and blades” model
Some products follow a strategy known as the “razor and blades” model. In this model, the device and its consumables are economically linked: a machine may look cheap at the time of purchase but require compatible, recurring refills throughout its period of use. That is why it is important to compare the initial price with the cost of the consumables.
Frequently asked questions
Is the cheapest device always the best choice?
No. A cheap device may use expensive refills and end up costing more over time.
What is the break-even point?
It is the moment when the savings from the cheaper refills make up for the extra amount paid for the device. After that point, the option that was more expensive at first starts generating savings.
How do you know if it is worth paying more for the device?
Compare the price difference with the savings the refills generate. Also consider how long you plan to use the product. If the break-even point comes before the end of the expected period of use, the more expensive option may be worth it.
Does how often I use it change the result?
Yes. The more often you use it, the faster the cheap refills make up for the higher price of the device. For someone who rarely uses the product, the break-even point can take much longer.
Does the cheapest refill guarantee the best purchase?
Not necessarily. Besides cost, you should also consider quality, durability, maintenance, warranty, energy consumption and refill availability.