Packaging Line Downtime Cost Calculator — $/Minute, $/Shift

What does a stopped packaging line cost? Three things at once: the margin on the units that did not get made, the crew standing at the line, and the overhead the line still carries. This calculator adds them into a cost per minute, then multiplies by the downtime you log per shift and the shifts and days you run for the cost per shift, per day, and per year, and it values the reduction you are targeting.

Worked example: a line making 60 units a minute at $0.50 contribution margin loses $30 a minute in margin. A crew of four at a $25 loaded rate adds $1.67 a minute, and $200 an hour of line overhead adds $3.33, for $35 a minute. Thirty minutes of downtime per shift on two shifts for 250 days is 15,000 minutes, or $525,000 a year. Cutting that downtime by a quarter is worth $131,000 a year, and every point of availability on 8-hour shifts is worth about $84,000.

Where the minutes go matters as much as how many there are. VeriPak alarms shorten the minutes between a fault and a response, and IntelliPak infeeds remove the misfeeds and jams that cause many of them in the first place.

How it works
  • Lost margin per minute = units per minute × contribution margin per unit.
  • Labor per minute = crew × loaded labor rate / 60; overhead per minute = line overhead per hour / 60.
  • Cost per minute = lost margin + labor + overhead; per year = cost per minute × minutes per shift × shifts per day × days per year.
  • Value of a reduction = per year × reduction %; one availability point = cost per minute × 1% of scheduled 8-hour shift minutes.
  • Worked example: $35 a minute × 15,000 minutes = $525,000 a year; a 25% reduction is worth $131,250.

Free, no login. Your inputs are saved in this browser. Values are engineering references — verify against manufacturer data and applicable codes before a final design.

Built by the engineers behind VeriPak packaging SCADA.

Engineering Toolbox
Loading toolbox

Questions engineers ask

How do I calculate the cost of downtime per minute?
Add the contribution margin on the units not produced (units per minute × margin per unit), the crew cost (crew × loaded rate ÷ 60), and any line overhead per minute. A 60-unit-a-minute line at $0.50 margin with four people at $25 an hour and $200 an hour of overhead costs $35 a minute.
Should I use revenue or margin per unit?
Contribution margin. Downtime on a line that can catch up later costs the crew and overhead only; downtime on a sold-out line costs the margin as well. Using revenue overstates the loss because the ingredients not used are not lost.
What is a point of availability worth?
One percent of the scheduled production minutes at the cost per minute. On two 8-hour shifts for 250 days that is 2,400 minutes a year; at $35 a minute one point is worth $84,000.

Related tools

Everything in the toolbox