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What is a lower scrap rate worth in material and capacity?

Value avoided scrapped material separately from any capacity opportunity.

Example scenario

Editable demonstration inputs, not verified industry benchmarks. Enable JavaScript to calculate your own scenario.

Annual units started
200,000
Current scrap rate
8 %
Target scrap rate
4 %
Irrecoverable material / scrapped unit
$18
Disposal cost / scrapped unit
$2
Annual prevention program cost
$40,000
Annual direct scrap savings$120,000

Example result only, not a forecast or promise.

Scrapped units avoided
8,000
Material loss avoided
$144,000
Disposal cost avoided
$16,000

What to do with this result

Prioritize defects by cause and irreversible cost at the point of failure; do not count full selling price as scrap savings.

Know what is inside the model.

Planning model, not personalized financial advice. Your inputs remain in your browser.

Calculation method

Avoided scrap units = starts × (current scrap − target scrap). Direct savings = avoided units × (irrecoverable material + disposal) − program cost.

Assumptions and limitations

  • Example inputs are editable scenarios, not Aryo results or independently verified industry benchmarks.
  • Recovered capacity is not booked revenue or automatic cash savings. Validate the bottleneck, quality and demand before monetizing output.

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