oboloo

oboloo Glossary

Manufacturing Capacity

oboloo Glossary

Manufacturing Capacity

Manufacturing Capacity Definition

Manufacturing capacity is the maximum amount of product that a manufacturing facility can produce. The purpose of calculating manufacturing capacity is to determine whether a company has the ability to meet customer demand. There are two types of manufacturing capacity: theoretical and practical.

Theoretical manufacturing capacity is the maximum output that could be achieved by a manufacturing process, using ideal conditions and assuming no downtime. Practical manufacturing capacity takes into account the reality of factors such as equipment efficiency, downtime for maintenance, and worker productivity.

To calculate manufacturing capacity, you need to know the following information:

-The production time for one unit of product

-The number of machines in the production line

-The uptime for each machine (how many hours it can operate per day)

-The number of workers in the production line

-The average production rate per worker

Once you have this information, you can use the following formula to calculate theoretical manufacturing capacity:

Capacity = (Production time x Number of machines) / Uptime

For practical purposes, you would use the following formula:

Capacity = (Production time x Number of machines x Efficiency) / Uptime

Want to find out more about procurement?

Access more blogs, articles and FAQ's relating to procurement

Oboloo transparent

The smarter way to have full visibility & control of your suppliers

Contact

Feel free to contact us here. Our support team will get back to you as soon as possible

Oboloo transparent

The smarter way to have full visibility & control of your suppliers

Contact

Feel free to contact us here. Our support team will get back to you as soon as possible

© 2024 oboloo Limited. All rights reserved. Republication or redistribution of oboloo content, including by framing or similar means, is prohibited without the prior written consent of oboloo Limited. oboloo, Be Supplier Smart and the oboloo logo are registered trademarks of oboloo Limited and its affiliated companies. Trademark numbers: UK00003466421 & UK00003575938 Company Number 12420854. ICO Reference Number: ZA764971