Chen Fung LiewJoshua PrakashKok Seng Ong2025-09-122025-09-12202510.1504/EJIE.2025.147185https://dspace-cris.utar.edu.my/handle/123456789/11342This paper introduces equipment cost effectiveness, a metric for evaluating the financial performance of equipment in manufacturing. While overall equipment effectiveness is widely used to assess operational performance, its limited focus on financial aspects necessitates a more comprehensive approach. Equipment cost effectiveness addresses this limitation by quantifying the wastage of equipment acquisition cost and maintenance cost at any overall equipment effectiveness level. Real-world data from the medical device, tyre flap, and semiconductor industries validate equipment cost effectiveness through correlation analysis, revealing a negative relationship between overall equipment effectiveness and both equipment acquisition cost and maintenance cost. Equipment cost effectiveness provides a holistic evaluation of equipment, enabling better decision-making and cost optimisation. By bridging the gap between operational and financial evaluations, equipment cost effectiveness offers valuable insights for enhancing equipment efficiency and resource allocation in manufacturing operations. Copyright © 2025 Inderscience Enterprises Ltd.enECEequipment acquisition costequipment cost effectivenessimprovement costmaintenance costOEEoverall equipment effectivenessBiomedical equipmentCost benefit analysisCost effectivenessCost estimatingMaintenanceMergers and acquisitionsSemiconductor device manufactureAcquisition costsEquipment acquisitionEquipment acquisition costEquipment cost effectivenessEquipment costsImprovement costMaintenance costOverall equipment effectivenessDecision makingjournal-article