How to Calculate Maintenance Cost

In many plants, “maintenance cost” means little more than spare-parts invoices. But true maintenance cost has three components: labor, materials and downtime (lost production). This article explains how each component is calculated and why all three need to be tracked together.

1. Labor cost

Time spent on a maintenance/fault job multiplied by the relevant staff member’s hourly cost makes up the labor component. For this to be accurate, the work order’s open/close time and the assigned staff need to be recorded correctly — on paper forms this is usually entered approximately.

2. Material cost

The real stock cost (FIFO lot cost) of spare parts and consumables added to the work order makes up this component. In manually tracked systems, material cost is usually entered as a rough estimate; using real lot-based cost makes comparisons across plants or periods meaningful.

3. Downtime (lost production) cost

Production lost while a machine is down due to a fault is often a bigger cost item than labor and materials combined — yet it’s the least tracked component. Measuring downtime accurately requires the fault’s start and end time to be recorded (ideally captured automatically from the machine itself).

Why track all three together?

A plant that only looks at material cost may miss equipment that looks “cheap” but fails often and causes long downtimes. Combined with reliability metrics like MTBF/MTTR (see how to calculate MTBF and MTTR), it becomes clear which equipment is actually the most “expensive” — and it’s usually not the one with the highest parts bill.

How should this data be collected?

For all three components to add up consistently, the work order process needs to bring together staff/time tracking, automatic material deduction from stock, and fault start/end recording in a single flow. Doing this manually (spreadsheets/paper) is theoretically possible but leads to data inconsistency and missing entries in practice — we covered this gap in our what is a CMMS article.

Automatic cost calculation in bakimo

In bakimo, maintenance cost is never entered manually: the real FIFO lot cost of materials used and the assigned staff’s time × hourly rate flow automatically into the cost record. This feature is available on Pro and higher plans — see our pricing page for details.

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