Cost of Rework Calculator
Rework, the second crew, the warranty callback, the do-over deliverable, is often the largest unmeasured cost in a service business. Quantify it here.
How we count the cost (without double-counting)
Direct labour cost is the wages you pay for time spent redoing work, you're paying someone to produce output you already paid for once.
Lost margin is the contribution those same hours would have earned if they'd gone to billable work instead. We use the gap between your billable rate and your loaded cost, not the full billable rate, so the wage isn't counted twice. Add the two together and you get the revenue foregone, the all-in economic cost of an hour spent on rework.
One honest caveat: the lost-margin figure assumes your team is at or near billable capacity, so a rework hour genuinely displaces a billable one. If you have idle capacity, the real cost sits closer to the direct-labour number. We surface both so you can read it either way.
A note on the numbers
- Rework is almost never tracked, so it stays invisible on the P&L. We quantify it from the bottom up, the hours your team actually loses, rather than as a blanket percentage of revenue. That keeps the estimate grounded in your own numbers instead of an industry average.
- Documented standards, checklists, and quality-control protocols typically cut rework by half or more within the first six months, the gap between an "average" operation and a well-run one.
- All maths runs in your browser. Nothing is sent anywhere unless you choose to email yourself the results below.
Email me my results
Get a copy of these numbers in your inbox, plus a short note on what the figure means and how a documented Business Playbook brings it down.
Rework is fixable.
Most service businesses can cut it in half within two quarters. Let's scope what that would look like for you.