Downtime Cost Calculator
Put a number on an hour of outage so the argument stops being about opinion.
What you provide
Use 100 to count full revenue. Use your actual gross margin to count profit lost instead.
Result
About $21,200 for 4.0 h down, or $88.33 a minute
Treat this as the floor rather than the bill. It counts the hours and the wages, and it cannot count the orders that went to a competitor and never came back, the support calls that arrive for the next three days, or the contractual credits an SLA may owe. What the figure is genuinely good for is comparison: put it beside the annual cost of the redundancy that would have prevented the outage, and the argument stops being about opinion.
- Duration
- 4.0 h
- Lost gross profitFull revenue, no margin applied
- $20,000
- Idle staff time10 people at 60% blocked
- $960.00
- Recovery effort2 h of cleanup after service returns
- $240.00
- Total
- $21,200
- Per minute
- $88.33
What this cannot tell you
- An estimate from the figures you enter. It cannot see your systems, your sales or your incident history.
- It counts hours and wages only. Customers who leave, support load in the following days, contractual credits and reputation are all real costs it makes no attempt to price, so treat the total as a floor.
Take this with you
How this calculation works
Three costs are added together. Lost gross profit takes revenue per hour, applies your margin so you are not counting money that was never yours, and multiplies by the outage length. Idle staff time counts the people who cannot work, scaled by how completely the outage blocks them, since most outages leave some work possible. Recovery effort adds the hours a small team spends afterwards clearing queues and fixing what the failure left behind, which is real work that no downtime clock records.
What the results mean
- Lost gross profit
- Revenue you did not earn, adjusted for margin. Setting margin to 100% counts full revenue, which overstates the loss for anything with a real cost of goods.
- Idle staff time
- Wages paid for work that could not happen. The percentage matters: an outage of one internal system rarely stops everyone completely.
- Per minute
- The total divided by the outage. This is the figure worth carrying into a conversation about recovery time, because it makes the value of a faster failover concrete.
Common problems and fixes
- The total looks implausibly large
- Check the margin setting first. Counting full revenue as lost profit inflates the figure for any business that buys stock or pays per transaction. Then check whether the revenue was genuinely lost or merely delayed, since for many businesses a proportion of orders simply arrive later once service returns.
- I need this to justify spending on redundancy
- Work in expected annual cost rather than per-incident cost. Multiply the cost of one outage by how many you realistically have in a year, based on your own incident history rather than a vendor estimate. Compare that against the annual cost of the redundancy, including the ongoing complexity it adds. A failover setup that nobody has tested has a habit of becoming its own source of outages.
Frequently asked questions
What is a fully loaded hourly cost?
Salary plus employer taxes, benefits, equipment and overhead, divided by working hours. It is typically 1.25 to 1.4 times the bare salary rate. Using the salary alone understates what an idle hour costs the organisation.
Should partial degradation count as downtime?
It should, and this is where most reporting is generous to itself. A checkout that works for one customer in three is not up. Set the productivity percentage and revenue figures to reflect the share of work that was genuinely blocked rather than treating anything short of a total outage as zero.
How does this relate to an SLA?
An SLA gives you a downtime budget in minutes and, usually, a service credit if it is missed. The credit is almost always a fraction of a monthly fee and almost never covers the cost this calculator shows. Knowing the gap is the point: it tells you how much of the risk you are actually carrying yourself.
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