Financial Implications of Machine Failure and Possible Solutions

Why Machinery fails?

Machine failure is not only responsible for dampening the flow of streamlined operations in an industry, but it also affects the financial backbone of the industry. The causes of machinery failure can be many, ranging from incompetent labour to mishandled machinery. But, the implication of such failure is singular and fatal i.e. financial loss. The most common causes of machinery breakdown are:-
  • Irregular maintenance of machinery
  • Handling by unequipped and unskilled workforce
  • Failure to replace parts as when required
  • Taking the equipment to work beyond it’s capabilities
  • Missing out on regular analysis of the equipment
  • Running the machinery on incompetent electrical supply


machine breakdown

Actual Impact of Machine Failure

  • Industrial operations are largely dependent on the working of appropriate equipment and machinery. Therefore, on the account of such failure, the whole industrial operation takes a hit. Other than cost of replacing failed machinery, several other financial implications come into existence.
  • Cost of workforce associated with removal of failed machines
  • The machines used in industrial operations are often composed of complex electrical connections and are even quite huge in size. It is not a layman’s job to efficiently remove the failed equipment from the premises without causing any more damage that might result out of careless handling.
  • Cost of replacement or repair of failed machines
  • The cost associated with replacing failed parts of industrial machinery is a factor that definitely causes a dent in the monopoly of small, medium as well as large enterprises dealing with machinery failure.
  • Cost of dealing with efficiency loss
  • Another financial implication that is not as straightforward as the two mentioned above is that of dealing with the downfall of the efficiency of the industry as a whole. Failed machinery leads to failure of certain aspects or operations undertaken by the industry, which further lead to loss of utility costs, labour wages, and even impact customer customer experience in a negative way.

How to minimize the loss caused by Machine failure 

machine breakdown


All it takes for a organisation’s existence to disappear are a few machine failure either occurring simultaneously, or even at irregular intervals that lead to increased vulnerabilities in the mechanism of day-to-day operations. A catastrophe is better to be prevented that to be dealt with when it happens! The following preparatory measures can help SMEs and well as Large enterprises to minimize losses caused by equipment breakdown:-

Mapping out areas where machine failure is likely to happen in the timespan of industrial operations is a good way to be prepared for the financial implications of such failures as and when they happen.
Having a contingency plan in plan in case of machine breakdown can minimise the loses that can otherwise be fatal.
Hiring professional industrial consultants who have an expertise in dealing with such situations and provide credible solutions to expected as well as unexpected equipment failure.
Solutionbuggy gives you a portal that can equip you with talented industrial consultants as and when required which helps you reduce down time and get your machinery working.


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About the Author: Arjun N

Founder of SolutionBuggy who has about 11+ years of experience in manufacturing industries. An entrepreneur with astute sales and marketing skills.

1 Comment

  1. The fundamental in understanding machine failures is to have a skilled engineer, like a good physician to understand a patient. Machine is less complex compared to human. Machines are designed to perform based on inputs and the result is statistical with a mean and standard deviation. Unless we measure the inputs and outputs to and from the machine, we can never diagnose failures and means to prevent the same in future. Understanding in and out of the machines and their inputs require skill. Operating the machines also requires trained individual and this is getting automated to avoid operator error. Regards.

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