Equipment Utilisation Rate
Construction – percentage of available plant and equipment hours used on productive site work
What is Equipment Utilisation Rate?
Equipment utilisation rate is the percentage of available equipment hours that are used productively. It shows how well expensive machinery is put to work.
Idle equipment costs money in ownership and hire, so utilisation is a key measure for construction and engineering firms.
How this KPI is measured
- Function
- Operations & Supply Chain
- Sub-function
- Equipment
- Industry
- Construction & Engineering
- Type
- Lagging
- Impact
- Efficiency
- Unit
- %
- Measurement frequency
- Weekly / Monthly
- Formula
- (Productive equipment hours / Total available equipment hours) × 100
How to calculate it
Divide productive equipment hours by total available equipment hours, and multiply by 100.
For example, if a machine was available for 200 hours and worked productively for 130, utilisation is 65%.
Use consistent definitions of available and productive time, and track by machine and by project.
Where it is used
Right-sizing the fleet
Decide what to buy, hire or sell.
Improving scheduling
Reduce idle time.
Controlling cost
Reduce hire costs.
How to improve it
Tips and common mistakes
- 100% is not a realistic target, since maintenance and set-up are needed.
- Compare with hire cost.
- Track by machine type.
More Operations & Supply Chain kpi library
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