Scrap Rate Cost Calculator

Put a dollar figure on scrap and rework from your reject rate, part cost, and production volume.

Scrap and rework quietly drain profit. Multiplying the reject rate by the fully loaded part cost and the volume turns a percentage into real dollars to target.

Formula: Scrap cost = Reject rate × Part cost × Volume

Worked Example

  1. A 2% reject rate, $3.00 part cost, 500,000 parts/yr.
  2. Scrap cost = 0.02 × 3.00 × 500,000 = $30,000 per year.

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