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Repair and Maintenance: What’s the Difference?

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If you’re working with expensive assets, it’s crucial to your company’s success to keep them operational as much as possible. That’s why understanding the differences between repair and maintenance is critical for smooth operations with minimal unplanned downtime

Repair and maintenance are different concepts with one  goal — to get the most out of your assets. In short, repairs involve fixing broken or malfunctioning assets, while a maintenance plan involves keeping equipment in tip-top shape, so breakdowns are fewer and productivity continues. Let’s take a deeper dive into both, so you know how they can benefit your organization. 

What Are Repairs? 

When an asset breaks, is damaged or stops working, repairs restore the asset to working order. When equipment fails, a technician performs one of two repair levels, depending on the type of failure. These include:

  • Partial failure: This occurs when an asset is still working but at less than full capacity and with potential safety hazards. A repair at this stage gets an asset to full capacity, preventing a complete failure.
  • Complete failure: This occurs a complete equipment breakdown takes place, and an asset cannot be used again until repairs are performed. 

Examples of Repairs 

Let’s take a look at some facility repair examples. These assets contribute to a facility’s safety, comfort and functionality when they work properly.

  • Replacing a broken window: Broken windows compromise a facility’s security and energy efficiency. To repair a broken window, you must remove the old glass, clean the window frame and measure the area where the old glass was. Then, a replacement pane is purchased. Once the new pane arrives, the frame is sealed with caulk, and the new window is installed. The repair has not only restored the window’s function but also improved the home’s insulation and appearance.
  • Fixing a leaking roof: If not addressed promptly, roof leaks can lead to significant water damage. To repair a leak in a shingled roof, the property owner or service professional will first find its source. Once located, they will replace any damaged shingles by lifting the surrounding shingles and removing the nails holding the faulty asset. They’ll slide a new one into place and secure it with roofing nails. Properly fixing a broken shingle prevents water damage and extends the roof’s lifespan.
  • Repairing electrical wiring: Faulty electrical wiring poses a serious safety hazard for a property and can sometimes involve major repairs. Before a repair, a maintenance technician turns off the power at the circuit breaker. Then, they identify and replace damaged wiring and test it.

What Is Maintenance? 

Asset maintenance is the action that ensures an organization’s assets are kept in good working order without affecting operations as much as possible. It prevents breakdowns and extends the asset’s lifespan. The varying types of maintenance strategies include: 

  • Reactive maintenance: This kind of maintenance work is done when a maintenance department addresses problems as they arise. A failing asset prompts a diagnosis and repair. And the goal is to restore its operating condition.
  • Corrective maintenance: Some tasks don’t fall under reactive or preventive categories. Instead, they’re considered corrective maintenance. One common example is changing a light bulb in that it needs to be replaced to restore proper lighting.
  • Preventive maintenance: This is a type of proactive maintenance that allows maintenance technicians to increase machine uptime and maximize productivity by performing maintenance activities and routine inspections, according to a fixed preventive maintenance schedule.
  • Predictive maintenance: This kind of maintenance program relies on maintenance technology and condition monitoring to diagnose an issue. For example, a device sensor will show if an asset is underperforming in real time by alerting a computer maintenance management system (CMMS), which, in turn, brings the issue to a technician’s attention.

Examples of Maintenance 

Maintenance is essential for the efficient operation and longevity of an asset. Incorporating each of these maintenance tasks into a regular maintenance operations schedule also helps prevent costly breakdowns and extends the equipment’s lifespan. Here are three examples of equipment maintenance

  • Routine maintenance inspections and cleaning of components: Regularly inspecting and cleaning a machine’s parts, like an air-conditioning unit or larger HVAC system, helps prevent breakdowns. This can involve periodically checking for wear and tear and loose parts while cleaning filters, fans and surfaces to remove dust and debris. These tasks help identify and address problems before they start. 
  • Applying lubricants to moving parts: Applying lubricants reduces friction and wear. It enhances performance, extends component life and leads to fewer repairs. Regularly applying the appropriate lubricants also prevents overheating.
  • Adjusting settings and calibrating sensors: Adjusting settings and calibrating sensors is sometimes needed for optimal machine operation. This involves comparing sensor readings against standard measurements and making necessary adjustments. Regularly checking parameters like temperature and pressure keeps a machine running safely with fewer breakdowns. Calibration maintains machine precision, helps prevent production errors and ensures the quality and consistency of an asset’s output.

Understanding the Repair and Maintenance Tax Implications 

Businesses can benefit from tax deductions when they incur expenses for routine repairs and maintenance. These activities are considered a business expense that’s necessary to keep the asset in its normal working condition. Associated maintenance costs can be deducted in the year they are incurred.

However, the Internal Revenue Service (IRS) also requires businesses to capitalize on some costs associated with significant overhaul improvements. Instead of deducting these expenses in the year they occur, a business must spread the cost over the useful life of the asset through depreciation. This capitalization process delays the tax benefits but can ultimately be more cost-effective by reducing taxable income over several years.

So, how do you know which expenses you can write off in the same year? The IRS has a regulation called “safe harbor” that allows a business to fully deduct some expenses if it meets specific requirements as laid out by the “BRA Test” (Betterment, Restoration and Adaptation). 

If a repair or maintenance expense makes equipment better than it was, restores it to its original condition or adapts it for a different or new use, a company must capitalize that expense. If it does not fall into these specific categories, a company expends the full amount in the same year if it does not exceed the financial thresholds as required by the IRS.

How a CMMS Can Help

A CMMS software like Coast is designed to help with all aspects of your maintenance, repair and overhaul (MRO) strategy. Maintenance teams can use it for asset management, spare parts inventory management and work order management.

Through automation, team members are alerted to emergency repairs or planned maintenance tasks, while the software also stores information such as inspection checklists or equipment manufacturer guidelines. All of these components help reduce disruptions in your overall business operations that result in cost savings in the long run.

  • Michelle Nati is a contributing writer to Coast who has written about business, law and finance for Leaf Group and Big Edition sites Legal Beagle and Work + Money. She lives in a 100-year-old house in Los Angeles and spends her spare time combing flea markets for vintage decor and spending time with her rescue dogs, Jellybean and Jukebox.

Why worry when you can Coast?

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