"We are so small, we cannot afford such an investment." or "We don't need to focus on continuous improvement.". These are often used arguments by small business owners. Let's see what "size" your company needs to be in order to make the decision to focus on downtime reduction justifiable.
Take a look at the small company below. It has:
Given the current conditions this small company makes a € 30K profit. If they only reduce their downtime from 15 to 12 percent, their profit rises from € 30K to € 53K. An increase of 23K.
Lets say it takes 6 months to get to 12% downtime while during those months they invest € 9K in continuous improvement tool ProMISe, including implementation and training. While their costs rise with € 9K their profit rises with € 23K, increasing their net profit with € 14K. An investment that pays itself back 2,5 times within a half a year!
No matter what scenario you are in, we invite you to use our Return On Investment calculator and see the effects of downtime reduction in your specific situation.
