Failure-cost worksheet
First use the Label Cost Calculator to establish the variable media-and-ribbon cost for one replacement label. Then add actual labor, downtime and other attributable costs. Use the same currency for every term.
Replacement production = affected labels × variable cost per label
Rework labor = rework hours × loaded labor rate
Downtime = downtime hours × documented downtime rate
Total failure cost = replacement production + rework labor + downtime + disposal + expedited freight + known contractual costInputs to document
| Input | Evidence to use | Avoid |
|---|---|---|
| Affected labels | Counted rejects or confirmed reprint quantity | Entire order without evidence |
| Replacement cost | Media and ribbon consumed per good label | Purchase price without accounting for usable yield |
| Rework labor | Recorded hours × loaded labor rate | Including the same time again as downtime |
| Downtime | Measured unavailable hours × approved rate | Generic industry averages |
| Other costs | Invoices, disposal records or contractual debits | Hypothetical penalties |
Worked example
Illustrative scenario: 5,000 affected labels at $0.01875 variable replacement cost equal $93.75. Three rework hours at $42 equal $126, 1.5 documented downtime hours at $120 equal $180, expedited freight is $75 and disposal is $20. With no contractual debit, the estimated failure cost is $494.75.
This example demonstrates the arithmetic only. Replace every value with job records; it is not an industry benchmark or a claim about typical failure cost.
Use the result for corrective action
Keep the financial estimate separate from root-cause analysis. Record the defect, detection point, affected quantity and corrective action so future estimates can use observed waste and setup history rather than a generic percentage.
Frequently asked questions
Should lost sales be included?
Only when the amount is supportable and attributable to the event. Keep speculative consequential losses outside the operational worksheet.
Is downtime the same as rework labor?
Not necessarily. Downtime represents unavailable equipment or capacity; labor represents people performing diagnosis, sorting or rework. Define both rates and avoid counting the same cost twice.
Should the original failed run and the replacement run both be counted?
Count the cost scope consistently. If the original run was already included in the normal job cost, the incremental failure estimate usually adds the replacement run and attributable recovery costs.
Run the calculation
Use your own measurements in the browser-based calculator. Inputs are processed locally and are not uploaded to LabelOps Lab.
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