15 Oct

The Hidden Cost of Downtime in Food Processing

From equipment availability to brand reputation, here is what you need to know about the costs of downtime in your food processing production.

Machine Monitoring
Production Monitoring
The Hidden Cost of Downtime in Food Processing

The word downtime is enough to send even the most level-headed leaders scrambling for solutions. And it makes sense: Full, uninterrupted production usually equals more revenue. However, “full, uninterrupted production” is a dream scenario manufacturers rarely experience.

Something always limits your efficiency, but the closer you can get to that perfect production cycle, the better—and addressing the true cost of downtime could get you closer than ever.

The Two Types of Downtime—Planned and Unplanned

Downtime isn’t only one thing; it’s actually two enemies in one.

You have unplanned downtime caused by equipment failures, material shortages, transportation delays, inconsistent shift schedules, leaks and spills, or poor maintenance. But you also have to invest time and resources into planned downtime. These instances of downtime are usually budgeted for and can include everything from equipment cleaning and technology upgrades to product testing and total facility overhauls.

Together, these two sides of downtime represent the ultimate fear for many food processing manufacturers: staff, equipment, and money all being wasted as time goes on. And the costs, if ignored, can be devastating to your bottom line.

Breaking Down the Costs of Downtime

Downtime, especially unplanned downtime, can wreak havoc on your budget, your annual earnings, and your ability to stay in business. A 2016 study by Aberdeen Strategy & Research put the cost of downtime at $260,000 per hour, and with some businesses reporting as much as 800 hours of downtime annually ... well, you do the math.

Food processors can lose a percentage of production capacity thanks to downtime, with many businesses reporting 20 percent or more in lost capacity. But it isn’t just the year-end dollar amount where you feel the pain. Consider these other, less obvious but still crucial costs of downtime:

  • Equipment availability: Most businesses make more than one thing and operate on a precise schedule. Downtime on a Monday morning won’t just affect that day—it can create a cascade that rolls through the week, impacting other production and delivery schedules.
  • Labor costs: When something goes wrong, somebody has to fix it. Unplanned downtimes lead to overtime costs, additional maintenance, and company-wide slowdowns as staff respond to something else at the expense of their normal duties.
  • Supply chain responsiveness: Food processing isn’t a single-location business. You have suppliers bringing in raw materials and transportation deadlines to ship out your product. Downtime creates waste and material logjams that affect all the links in your supply chain.
  • Reputation: When a supplier’s product goes to waste or a customer’s order gets delayed, they could look elsewhere for service. Every hour of downtime represents another hour during which committed business partners could begin looking to your competition.
  • Employee stress: Everyone works better in a low-stress environment, and nothing induces stress like equipment failure. The added pressure of unplanned downtime, reactions from management, schedule changes ... it all builds up, and your team is sure to feel the strain.

Can Food Processors Solve for the Cost of Downtime?

Your business doesn’t have to sit back and put up with the constraints associated with downtime. There are resources available to monitor its impact and even reverse course, creating opportunities for greater efficiency and fewer downtime-related limitations.

  • Take a predictive approach to maintenance: You can eliminate many problems before they become problems through preventative maintenance. This form of maintenance relies on strong data and planning but can be quite cost-effective.
  • Assess your equipment, staff, and scheduling: According to Processing Magazine, the most common causes of unscheduled downtime are equipment (42 percent), user error (19 percent), and poor scheduling of necessary maintenance (13 percent). Taken together, you could eliminate three-fourths of unplanned downtime by investing in reliable equipment, staff training, and regularly scheduled maintenance.
  • Don’t ignore fixes to planned downtime: Unplanned downtime is an obvious annoyance, but poorly executed planned downtime can have its own pitfalls. Ask these questions during your next team meeting to better understand where you can make corrections:
  • Are we being as efficient as possible during planned downtime?
  • Can we expedite planned downtime or reduce occurrences?
  • Is there a problem hidden in plain view creating a need for planned downtime?
  • Could we minimize changeover by reworking a process or adding new technology?

Each step can help your team internally answer questions about how unplanned downtime can be prevented and how planned downtime could be done better. Unfortunately, this alone might not get you all the way to your goal—but the right outside partner with the right resources can move you the rest of the way.

Worximity Can Reduce Your Downtime—Begin Your OEE Trial

Improving real-time data can help reduce both planned and unplanned downtime. You and your team may be shocked by how much additional production capacity you have available!

Worximity’s overall equipment effectiveness (OEE) assessment will:

  • Confirm your real-time OEE
  • Benchmark your efficiency against your industry
  • Highlight quick and accessible efficiency opportunities on your shop floor
  • Help you estimate the additional revenue you’ve been sitting on

You can move your business from typical to best-in-class, but doing so requires access to the right information. Start your OEE journey today and let us help you eliminate the downtime that’s been holding you back.

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