It Started With a Budget Review
Back in Q1 2024, I was neck-deep in our annual procurement audit. Our facilities budget was up 12% year-over-year, and my CFO wanted answers. I've managed our company's vendor contracts for about six years now, covering everything from office supplies to our main warehouse operations—about $2.3 million in annual spend across 40+ vendors.
One line item kept jumping out: lighting replacements. We were spending way more than I expected on bulbs and fixtures, especially for our 50,000-square-foot distribution center. That's when I started digging into our lighting costs and, eventually, into Cree as a potential solution.
To be fair, I wasn't looking for a brand name. I was looking for numbers. But what I found surprised me—and saved us roughly $8,400 annually.
Step 1: Figuring Out What We Actually Had
First, I walked the floor with our maintenance lead. We inventoried every fixture in the building. Here's what we were working with:
- High-bay warehouse lights: 48 units, old metal halide, 400W each
- Office and break room troffers: 36 units, T8 fluorescents
- Exterior flood lights: 12 units, halogen, 500W each
- Emergency exit and egress: 20 existing LED units (already swapped before my time)
The previous setup wasn't terrible—it worked. But when I ran the numbers on energy consumption, it got ugly. Those metal halide fixtures alone were running about 16 hours a day, five days a week. At our local industrial electricity rate of roughly $0.12/kWh (verified against our utility bills from January 2024), just the warehouse lighting was costing us nearly $1,500 a month in electricity. Plus, we were replacing bulbs every 18 months, and that labor added up fast.
The Vendor Comparison: Why Cree Made the Shortlist
I got quotes from four vendors. Two offered generic LED chips and fixtures. One pushed a major competitor's solution. And one—let's call them Vendor C—recommended Cree light fixtures specifically, including the Cree LS series for the high-bay areas and Cree surface downlights for the offices.
Initially, I almost went with the cheaper generic option. Vendor A quoted $14,200 for the full retrofit. Vendor B (the Cree solution) came in at $18,700. That's a $4,500 difference—real money when you're justifying a capital expense.
But here's where my TCO spreadsheet kicked in. I built a comparison model tracking: upfront cost, installation labor, estimated annual energy usage, expected bulb replacement frequency, and warranty coverage. The generic vendor offered a 3-year warranty. Cree's fixtures came with a 5-year warranty on the LED chips and a 10-year on the fixture housing.
When I projected costs over a 7-year period—which is our standard depreciation schedule for building improvements—the picture flipped. Vendor A's total: $31,200 (including two expected bulb replacements and higher energy use). Vendor B's total with Cree: $24,800. That's a $6,400 difference over 7 years—in favor of the more expensive upfront option.
Granted, this required more analysis than a simple price comparison. But I've learned the hard way that 'cheaper' upfront almost always means 'more expensive' later.
The Cree LS Lighting Series: A Closer Look
The specific product our vendor recommended was the Cree LS lighting series for the high-bay warehouse. These are linear LED fixtures designed for industrial use, and they had a few specs that stood out:
- 150 lumens per watt efficacy (vs. about 70 lm/W for our old metal halides)
- 50,000-hour rated life (about 12 years at our usage rate)
- 0-10V dimming capability (something we hadn't even asked for)
- IP65 rating for dusty warehouse environments
The surface downlights for the office area were a different story. Those were more about comfort and aesthetics than raw efficiency—something our office manager cared about way more than I did. But even there, the Cree surface downlights were roughly 40% more efficient than the T8s they replaced.
The Installation: What Actually Happened
The installation took four days total. Our maintenance team handled the office downlights themselves over a weekend. The warehouse high-bay fixtures required an electrical contractor—that was a $2,800 line item I hadn't fully anticipated. (Note to other procurement folks: always budget for external labor if the work is at height or involves re-wiring.)
Day one: demo of old fixtures. Days two and three: mounting the new Cree fixtures and running conduit. Day four: testing and commissioning.
The biggest surprise? The dimming capability. Our warehouse manager had been complaining about glare during early morning pick operations. With the 0-10V dimming, we set the lights at 70% during first shift, full brightness during peak hours, and 30% during cleanup shifts. That flexibility saved us an estimated additional 8% in energy costs—something I hadn't modeled.
The Results (Six Months In)
We're about six months post-install now, and the numbers look good:
- Monthly warehouse electricity cost: down from $1,480 to $420—a 72% reduction
- Maintenance calls: zero (vs. an average of one bulb replacement per month with the old setup)
- Payback period: projected at 2.3 years, versus my initial estimate of 2.8 years (thanks to that dimming savings)
I have mixed feelings about the overall process. On one hand, I'm proud of the savings—this is a solid ROI story. On the other, I wonder if I could have squeezed more. Should I have negotiated harder? Maybe pushed for a larger rebate from our utility company? (We did get a $0.05/kWh rebate for installing high-efficiency fixtures, which shaved $900 off the project cost.)
Bottom line: the Cree solution wasn't the cheapest option. But it was the most cost-effective one over the life of the investment. That's the lesson I keep coming back to: lowest price ≠ lowest cost.
What I'd Do Differently Next Time
Get a lighting audit first. We did this, but I'd recommend it earlier in the process. Some utilities offer free or subsidized audits. Ours was $300 and identified two areas we hadn't considered: exterior flood lighting and parking lot poles.
Check for rebates early. Our local utility rebate covered about 5% of the project. Not life-changing, but it made the internal ROI case easier.
Factor in installation complexity. I underestimated the labor cost for the warehouse high-bays. If I were doing this again, I'd get three quotes from electrical contractors before committing to a fixture vendor.
Plan for the 'what ifs.' Even after choosing the Cree fixtures, I kept second-guessing. What if the dimming feature failed after a year? What if our energy rates dropped and the savings didn't materialize? The two weeks between signing the contract and seeing the first fixtures arrive were stressful. But I relaxed once the installation went smoothly.
One last thing: consider total cost of ownership, not just upfront price. That sounds like a cliché, but it's the single biggest factor in whether a lighting retrofit actually saves money. The Cree LS series was more expensive per fixture than its competitors, but its efficiency, durability, and warranty made it the better investment—for our facility, at least.