In manufacturing, downtime is a four-letter word, while unplanned downtime is an unforgivable curse. You know it’s bad, but do you know how bad?
These 7 statistics illustrate just how much of an impact downtime can have on your business:
- In 2016, the average cost of downtime across all businesses was $260,000 per hour. That was a 60% jump from 2014. (source)
- In some industries, the cost is considerably higher. In the auto industry, downtime can cost up to $50,000 per minute, which equals $3 million per hour. (source)
- Even so, the true cost of downtime is unknown. Consultants believe that 80% of industrial facilities are unable to accurately estimate their downtime. A common estimate is that factories lose anywhere from 5% to 20% of their productivity due to downtime. (source)
- Human error causes 23% of unplanned downtime in manufacturing. That’s 2.5x higher than in other sectors. (source)
- Faulty equipment is another common cause of downtime. A 2017 survey found that 70% of companies lack complete awareness of when equipment is due for maintenance or upgrade. (source)
- The average cost of a downtime incident is about $17,000. (source)
- Manufacturers experience an average of 800 hours of downtime every year. (We don’t have a primary source for this, but it’s a frequently cited number in the literature.)
It would be great if you could prevent unplanned downtime completely. But, of course, you can’t. Downtime is inevitable — things go wrong, people make mistakes, and equipment goes on the fritz.
What you can do is use buffers to reduce the impact of that downtime on your productivity and throughput by keeping your lines running even if a single piece of equipment goes down.
For a short and sweet explanation of how this works, check out the article Maximizing Throughput: Buffers. If you’ve got a little more time and want to dig into the math, read What Is Throughput (And Why You Should Care). As always, if you have any questions, get in touch.