You can’t afford to be offline. Literally.
Downtime is the scourge of the modern working world. Few – if any – technical issues are more infuriating. Whether it’s planned maintenance or a surprise outage, not being able to access your systems during working hours leaves projects unfinished, contracts unsigned, and business owners understandably frustrated.
Frustrated – that is – and broke.
In addition to costing businesses an arm and a leg in peace of mind, excessive downtime can also cost companies millions of dollars in cold hard cash. From lost revenue to hefty recovery price tags, anytime your business is down, you are in effect hemorrhaging money.
How much money? Let’s find out:
What is Downtime?
Just to make sure we cover our bases, let’s begin with a quick definition.
When referring to IT programs specifically, downtime describes any time you are unable to access your systems, networks, or machines. Downtime can be caused by anything from hardware failure to software issues, from network connectivity problems to prolonged maintenance requirements, all of which can have severe consequences for your bottom line.
Some of the costs associated with downtime include:
- Lost Sales
- Lost Productivity
- Lost Data
- Lost Revenue
- Hardware Repair Costs
- Software Costs
- Recovery Costs
- And More
Downtime, By the Numbers
Based on findings by Solarwinds, the average cost of downtime per minute for small businesses is $427 and $9,000 for larger enterprises. If you think of this cost per minute from an hourly perspective, a single hour of downtime costs small businesses roughly $25,620 and over half a million ($540,000) for enterprises.
In June of 2021, a 1-hour downtime cost Amazon $34M in sales.
A 5-hour Facebook outage in 2021 reportedly cost the social media giant a whopping $65M in revenue.
In a Gartner survey, 98% of companies stated the cost of IT downtime ranged from $100,000 to $540,000 per hour.
So, the risks are clear, but how do we determine how much downtime is going to cost your business in particular?
Approximately, the cost of downtime per hour equals lost revenue plus lost productivity per hour plus the cost to recover per hour.
You can approximate productivity by multiplying the number of employees affected by their hourly rate, and approximate lost revenue by dividing annual revenue by how many hours your team works in a year.
While these equations might not provide you with the exact number, they’ll give you a fairly good idea of your price point. And we’re willing to bet it’s not a pretty one.
Of course, not every cost associated with downtime can be calculated in nickels and dimes. As with any major technological issue, there are some ancillary costs to losing system access that, while they may not have an exact price point, can certainly hit your bottom line – and hard.
Some intangibles associated with IT downtime include:
- Damaged Reputation
- Lack of Confidence
- Stress (Both Human and Technological)
- Security Concerns
- Lost Momentum
- Lack of Customer Service
What Goes Up, Needn’t Come Down
Are the numbers making you nervous? They should. But in the face of such staggering statistics, it’s important to remember that downtime isn’t inevitable. With the right IT program in place, the threat of downtime can be almost non-existent.
EMPIST can help you build that program. With two decades of multifaceted technology experience, our team is ready to help develop a tailored plan that changes with your business while still minimizing risk.
Interested in getting started? Say no to downtime, contact us online today to learn more about EMPIST IT services.