![]() ![]() Calculate Production Capacity with Multiple ProductsĬalculating production capacity for a mix of products can be more complex. The production capacity is 800 divided by 0.5, or 1,600 widgets per day. ![]() For example, say it takes a worker half an hour (0.5 hours) on a machine to make a widget and the capacity is 800 machine hours. Determine how long it takes to produce one unit of product, then divide the daily plant capacity in hours by the time it takes to produce a product to arrive at the daily production capacity. Production capacity planning for a single product is a fairly straightforward calculation. Calculate the Production Capacity with One Product The daily plant capacity in hours is 16 hours multiplied by 50 machines, or 800 machine hours. For example, say that a plant has 50 machines and workers can use the machines from 6 a.m. The first step in understanding production capacity is to calculate the machine-hour capacity of the factory or manufacturing plant. The formula for production capacity is machine-hour capacity divided by the time it takes to produce one product. Production capacity can be calculated based on a single type of product or a mix of products. It's defined as the maximum output that an organization can produce with the available resources in a given period. Understanding production capacity allows a business to estimate future financial performance and create a timeline for delivering products.
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