Downtime cost calculator: the real cost of downtime per hour

Output per hour

Units the machine or line makes in a normal running hour, in the unit you sell or count, such as molds, castings or packs.

Contribution margin per unit

Selling price per unit minus the variable cost per unit, in INR. It is what each unit adds toward fixed costs and profit.

People idled

Operators and helpers who are paid but cannot work while the line is down.

Loaded labor cost per person-hour

Wage plus benefits and other employment costs for one person for one hour, in INR.

Repair cost per hour

Average spend on parts and outside service for each hour of downtime, in INR.

The default values in the calculator are example values for you to replace with your own. They are never industry figures.

Unplanned downtime hours per month

Hours the line was stopped by breakdowns in a typical month. Leave out planned maintenance and changeovers.

Scrap and restart cost per event

Optional. Material scrapped and the cost of bringing the line back to a good first piece after each stoppage, in INR.

Events per month

Optional. How many separate unplanned stoppages happen in a typical month.

Monthly cost

The monthly figure from the formula above, for a typical month.

If your downtime is seasonal, work out a few months separately and add them instead of multiplying one month by 12.

Cost per hour is the number to use in day-to-day decisions. Put it next to the price of a critical spare, an extra PM visit or a second technician on night shift, and the trade-off becomes clear.

Monthly and annual cost show the size of the problem for your plant head and finance team. Use them to rank machines: run the calculator for each critical asset and start with the one that costs the most, not the one that breaks most often.

Look at the split as well as the total. If lost contribution dominates, faster restarts and fewer breakdowns matter most. If repair cost is a large share, look at repeat failures, spare stocking and outside service rates.

• Counting only the repair cost. The parts and the service bill are usually the smallest part. The output you did not make is often far larger.
• Using revenue instead of contribution margin. When a line stops you also save raw material, power and other variable costs. Contribution margin takes those out, so revenue overstates the loss.
• Double counting labor. Count labor once. If your contribution margin already treats line labor as a variable cost per unit, the wages you still pay to idle people are a real extra loss, so enter them. If your margin leaves labor out as a fixed cost, enter only the extra you actually pay, such as overtime to recover output, or zero.
• Assuming every lost hour is lost for good. If you recover the output later with spare capacity, the lost contribution is smaller, but overtime and expediting costs take its place.
• Mixing in planned downtime. Planned maintenance and changeovers have their own cost logic. Keep this calculation to unplanned stoppages.
• Treating the defaults as benchmarks. The calculator's starting values are examples only. Replace every one with your own figures.

Your downtime hours and repair costs come from records instead of memory. In MaintenanceIQ, breakdowns are logged against each machine with their downtime, and maintenance cost is rolled up from the parts used and the charges recorded against each breakdown, by asset and by area. See breakdown and downtime tracking and maintenance cost analytics.

• How to calculate contribution per unit (opens in a new tab), AccountingTools. Defines contribution per unit and explains when direct labor is a fixed or variable cost.
• Economics of Manufacturing Machinery Maintenance: A Survey and Analysis of U.S. Costs and Benefits (opens in a new tab), Douglas Thomas and Brian Weiss, NIST, 2020. Examines the cost of machinery maintenance and the losses from inadequate maintenance strategies.