by
Houghton International, UK
Machine downtime can cause major complications. If there is no preparation in place, interruptions to appliances can be detrimental to productivity and profit margins. A study commissioned by Oneserve revealed machine downtime costs the UK approximately UK £18 billion a year.
If this was reduced it could boost the British economy at a time when it’s most
essential with Brexit remaining an unknown factor.
Machine downtime for UK companies
Machine downtime can cause any manufacturing process to cease. With growing consumerism creating higher demand for products, fast and efficient machine procedures are critical to a firm’s success.
The impact of machine downtime differs by sector; in the automotive industry, one minute can cost a staggering £17,000. A British Airways technical failure in 2017 cost the company £80 million.
It’s not just the financial side that is affected by machine downtime, a company’s reputation is also on the line if it fails to meet the demands of a supplier. There’s also the stress of employees who must rectify the downtime to consider.
How to calculate the costs of downtime
To calculate the costs of downtime, you must first work out the following:
• Labour costs: The duration of the machine downtime period x the hourly pay rate of your operators = Your lost labour costs
• Product costs: The price of a single-unit product x the total of items you produce in a certain period x the machine downtime period
• Recovery costs: Work out how much it costs you for: machine reboots, energy surges, replacing/repairing parts, retrieving lost data and your other calculations to get a more accurate machine downtime value
• Extra costs: Bear in mind that the value of machine downtime goes beyond profits lost during the downtime period
• Total cost: All the above costs plus the total cost of machine downtime. Ensure that you use the same units of time to work each section out for an accurate outcome (eg employee pay per hour, product output per hour, etc.)
Read more HERE.
Machine downtime can cause major complications. If there is no preparation in place, interruptions to appliances can be detrimental to productivity and profit margins. A study commissioned by Oneserve revealed machine downtime costs the UK approximately UK £18 billion a year.
Machine downtime for UK companies
Machine downtime can cause any manufacturing process to cease. With growing consumerism creating higher demand for products, fast and efficient machine procedures are critical to a firm’s success.
The impact of machine downtime differs by sector; in the automotive industry, one minute can cost a staggering £17,000. A British Airways technical failure in 2017 cost the company £80 million.
It’s not just the financial side that is affected by machine downtime, a company’s reputation is also on the line if it fails to meet the demands of a supplier. There’s also the stress of employees who must rectify the downtime to consider.
How to calculate the costs of downtime
To calculate the costs of downtime, you must first work out the following:
• Labour costs: The duration of the machine downtime period x the hourly pay rate of your operators = Your lost labour costs
• Product costs: The price of a single-unit product x the total of items you produce in a certain period x the machine downtime period
• Recovery costs: Work out how much it costs you for: machine reboots, energy surges, replacing/repairing parts, retrieving lost data and your other calculations to get a more accurate machine downtime value
• Extra costs: Bear in mind that the value of machine downtime goes beyond profits lost during the downtime period
• Total cost: All the above costs plus the total cost of machine downtime. Ensure that you use the same units of time to work each section out for an accurate outcome (eg employee pay per hour, product output per hour, etc.)
Read more HERE.
The Global Miller
This blog is maintained by The Global Miller staff and is supported by the magazine Milling and Grain
which is published by Perendale Publishers Limited.
For additional daily news from milling around the world: global-milling.com
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