Cost of Supply Chain Disruption Estimator

Last reviewed October 20, 2026 by the editorial team. How we review content

A supply chain disruption costs more than the days it lasts. Sales stall while stock is missing, and recovery takes time after supply returns. This estimator turns a delay, a recovery period and your margin into a profit figure you can compare with the cost of prevention.

Enter your own numbers below. Several fields are assumptions and are labelled as such.

How the estimate works

• Days affected = supply delay + recovery time
• Revenue lost = daily revenue x days affected x share of revenue affected
• Profit lost = revenue lost x profit margin
• Total impact = profit lost + extra costs
• Potentially avoidable = total impact x assumed avoidable share

Revenue is not profit. A business with a 15% margin loses 15 cents of profit per dollar of lost sales in this model, so the profit figure is much smaller than the revenue at risk. Costs that continue during the disruption, such as wages and rent, make the true impact larger when you use contribution margin.

Worked example

Daily revenue of $50,000, a 5-day delay and 2 days of recovery, all revenue affected, a 15% margin, no extra costs and a 20% avoidable share.

1. Days affected = 5 + 2 = 7
2. Revenue lost = $50,000 x 7 = $350,000
3. Profit lost = 15% x $350,000 = $52,500
4. Potentially avoidable = 20% x $52,500 = $10,500

Using the number

Compare the estimated impact with what prevention would cost, such as safety stock, a second supplier or a monitoring tool. A single event is only part of the picture, so multiply by how often similar disruptions happen to your business.

The model ignores lost customers, penalties you have not entered and effects on reputation. Add them as extra costs when you can support them with data. See our risk and resilience guides for ways to reduce exposure.

Common questions

How do you calculate the cost of supply chain downtime?

Multiply daily revenue by the days of disruption and recovery, adjust for the share of revenue affected, apply your margin to get profit lost, then add extra costs such as expedited freight or overtime. Repeat the sum for a few delay lengths to see the range.

Why is recovery time included?

Supply returning does not restore sales instantly. Rebuilding stock, rescheduling production and winning back customers takes days, and revenue stays reduced during that time. Leaving it out understates the impact, often by a wide margin on longer delays.

Should I use profit margin or contribution margin?

Contribution margin, which excludes fixed costs, gives a larger and often more accurate figure for short disruptions because fixed costs continue regardless. This calculator uses the margin you enter, so state which basis you chose.

Can AI predict supplier delays?

Models can flag elevated risk using signals such as shipment tracking, weather and supplier performance, which can give earlier warning. They do not guarantee a delay will be caught, so the avoidable share in this calculator is only an assumption.

Sources and further reading

• Association for Supply Chain Management (ASCM)
• MIT Center for Transportation and Logistics (MIT CTL)