The value of lost production is the income you could have made if the equipment hadn’t failed and production hadn’t been interrupted. Depending on how long your equipment is down for, this can mount up to thousands of dollars. (Here’s some more info on harnessing the power of metrics.)
If your equipment isn’t in good working order, it will inevitably require more maintenance than reliable equipment. For example, labellers might need print-heads to be changed more often. These costs can quickly add up in terms of materials and labour, as it takes workers from value-adding tasks. The result is lost profits.
Unreliable manufacturing equipment can lead to downtime, causing production to stop for an undetermined period — often without any warning. The true cost of a machine breakdown has been estimated as between four to 15 times the maintenance costs. Because for every second production is down, the company is losing money: you might miss deadlines, which impacts the rest of the supply chain, risks penalties and even customers.
So before you make any cuts to your maintenance budget or delay on replacing failing equipment, take a look at the total cost of unreliable equipment for your company:
If you can’t count on your equipment to work when production is scheduled, it’s unreliable. In the manufacturing industry, unreliable equipment has a greater cost than just monetary: it can affect workers, customer relationships, brand reputation and beyond.