Cost of Downtime per Minute: How to Price a Stopped Line

Key takeaways

• Price a stopped minute at contribution margin, not at the selling price and not at full cost.
• Only minutes lost at the bottleneck, or minutes that reach it, cost line output.
• A stop shorter than the buffer in front of the bottleneck usually costs no output at all.
• If the line is not sold out, the minute costs the recovery (overtime, an extra shift), not the margin.
• Agree the inputs once with finance, then show each stop in money on the shift board.

One minute of downtime costs the units your bottleneck did not make in that minute, times the contribution margin of each unit, plus whatever you spend to win them back. On a filler running 300 bottles a minute at a margin of $0.12 a bottle, that is $36 a minute before overtime or scrap.

Fabrico, an OEE and light MES platform, logs each stop with its start, its end and its reason, and puts a price on it the same way, so the stop list reads in money instead of minutes. This guide gives you the formula, the inputs to agree with your controller, and a worked shift you can copy.

What does one minute of downtime cost?

Use one formula and keep it the same on every line:

• Cost of a minute = units the bottleneck would have made in that minute x contribution margin per unit + recovery cost.
• Units per minute = the rated speed of the bottleneck for the product that was running.
• Contribution margin = selling price minus the variable cost of one unit (product, packaging, energy that scales with volume).
• Recovery cost = overtime, an extra shift, rush freight, or scrap from restarting the line.

Why contribution margin? Fixed costs such as rent, salaries and depreciation do not change because the filler stopped for ten minutes. What you really lose is the margin on the units you could have sold. This is the throughput accounting view: price a stop at contribution margin per bottleneck hour, never at an average cost per hour.

Why does a minute at the filler cost more than a minute anywhere else?

On most FMCG packaging lines the filler is the bottleneck by design. The machines around it run faster so the conveyors can catch up after a stop. That is why a stop on another machine often costs nothing in output: the buffer keeps the filler busy until the stop is over.

Little's law gives you the size of that buffer in minutes. A table holding 1,500 bottles in front of a filler running 500 bottles a minute protects the filler for 3 minutes. A labeller stop of 2 minutes behind that buffer costs no output. A labeller stop of 7 minutes costs 4 filler minutes.

So before you price a stop, ask which machine stopped first and how long the bottleneck actually stood still. Our guide to starvation and blocking shows how to read machine states to find out.

Does it matter if the line is sold out?

Yes, and it changes the price more than anything else. Ask your controller one question: could we have sold those units?

Freed capacity is only money if you sell it, or if it removes overtime, a shift or a planned investment. The controller decides that, not the software and not the OEE report.

How much does downtime cost in FMCG on average?

The most quoted figure comes from the Siemens report The True Cost of Downtime 2024, based on 181 interviews with large plants:

• A lost hour costs about $36,000 in FMCG.
• An average large plant loses 27 hours a month to unplanned downtime, across 25 incidents.
• FMCG is the only sector whose downtime hours went up since 2019.

Use these numbers to start a conversation, not to price your own line. They are plant averages for large companies. The same report puts an automotive hour at $2.3 million; never use that figure for a food or beverage plant. Your own line's cost comes from your own speed, margin and demand.

What does a worked example look like?

Sample line (illustrative numbers, not a customer): a water line with the filler as the bottleneck at 300 bottles a minute, a 3 minute buffer in front of the filler, and a contribution margin of $0.12 a bottle, or €0.12 in a euro plant. The product is sold out. Each filler restart scraps 60 bottles at a variable cost of $0.30.

• One filler minute = 300 x $0.12 = $36.
• Filler jam: 14 x $36 = $504. Labeller: 3 x $36 = $108.
• Restart scrap: 2 x 60 bottles x $0.30 = $36.
• Shift total: $648, or €648 in the euro version. Over 750 shifts a year: $486,000, or €486,000.

Now take the same shift on a line that is not sold out. The 17 lost filler minutes are made up on a weekend shift with a crew cost of $400 an hour: 17 / 60 x $400 = about $113, plus the same $36 of scrap. The shift costs about $149, not $648. Same stops, a four times smaller number. That is why the sold out question comes first.

Which mistakes make the number wrong?

• Using the selling price instead of contribution margin. That inflates each stop.
• Using one average cost per hour for the whole plant, so a case packer stop inside the buffer looks as expensive as a filler stop.
• Ignoring the buffer, so short stops on fast machines get a price they never had.
• Pricing minutes the line could not have sold.
• Forgetting restart scrap and slow running after a stop.
• Quoting another sector's average, such as the automotive hour, for an FMCG line.

How do you put the cost of a minute on the shop floor?

Agree four inputs with finance once: the bottleneck's rated speed per product, the contribution margin per unit, whether the line is sold out, and the recovery cost per hour. Write them down and review them each quarter.

Then show money, not only minutes, on the shift board. A list of stops ranked by cost tells the team where to start. Minutes still matter for the people fixing the machine, so keep both columns. Our guide to Pareto analysis for downtime shows how to rank, and the true cost of downtime covers the costs that sit below the surface. For the OEE side of the same numbers, see how to calculate OEE.

Where Fabrico fits

Fabrico is a computer vision enabled Manufacturing Performance Platform. OEE and light MES come first, with computer vision on stops.

• Automatic downtime logging, so each stop has a start and an end, including the short ones.
• Every loss priced in money with the inputs you agree with your controller.
• Losses ranked by money, so the filler stop rises above the case packer stop that never reached it.
• The operator confirms the reason in one tap, and a camera clip can serve as evidence for the stop.
• OEE live by line and shift, and one view across plants.

You start with a pilot on one line, with a baseline and a decision date agreed in advance. There is no free plan and there are no tiers: each plant gets a quote. See how a stop gets its reason and its clip on our computer vision OEE page.

Frequently asked questions

How do you calculate the cost of downtime per minute?

Multiply the units the bottleneck would have made in one minute by the contribution margin per unit, then add recovery costs such as overtime or restart scrap. Use the rated speed of the product that was running.

Should I use the selling price or the margin?

Use contribution margin. Fixed costs do not change when the line stops, so the selling price overstates the loss.

What is the average cost of downtime per hour in FMCG?

The Siemens True Cost of Downtime 2024 report puts it at about $36,000 an hour for large FMCG plants. Treat it as a plant average, not as the price of your own line.

Does a stop on a non-bottleneck machine cost anything?

Only when it lasts longer than the buffer in front of the bottleneck, or when it causes scrap. A short stop inside the buffer costs no output.

What if we are not sold out?

Then a lost minute costs what you spend to make the units later: overtime, an extra shift or rush freight. Ask your controller to confirm which case applies to each line.

See your line's minutes in money

Bring one line and its current stop log. We will show which stops reached the bottleneck and what each one cost.

Request a demo · Contact us