February 01st, 2025

Factory downtime can be quite costly, especially when waiting for original OEM automation equipment. The costs can be divided into tangible and intangible categories.

Tangible Costs:

1. Lost Production: This is the most immediate cost. If a factory produces 500 items an hour with a profit of $25 per item, an hour of downtime costs $12,500 in lost revenue.
2. Labor Costs: Salaries of employees who are idle during downtime.
3. Utilities: Costs for electricity, water, etc., that are still incurred even when production is halted.
4. Maintenance and Repair: Costs associated with fixing the issue that caused the downtime.
5. Lost Business Opportunities: Potential sales that are lost due to the inability to meet production schedules.

Intangible Costs:

1. Stress and Morale: Downtime can affect employee morale and increase stress levels.
2. Customer Trust: Delays can erode customer trust and satisfaction.
3. Innovation: Downtime can hinder innovation efforts as resources are diverted to fix issues.

​The true cost of downtime can be significantly higher than just the immediate lost production. It's important to accurately estimate these costs to make informed decisions about investments in equipment and maintenance.