The Easy Way: Total Production Quantity During a Time Period
One of the easiest ways to measure capacity is to simply use the total production quantity for a given time period. For example, if your plant can produce an average of 20,000 gizmos per week, then your total capacity is 20,000 gizmos per week.
How do you calculate capacity?
The formula for capacity-utilization rate is actual output divided by the potential output. For example, say that a business has the capacity to produce 1,600 widgets a day as in the above example, but is only producing 1,400. The capacity utilization rate is 1,400 over 1,600, or 87.5 percent.
How do you calculate product capacity?
The formula used to calculate production capacity is:
- Factory machine capacity in hours divided by.
- Product SAM (how long it takes to produce one unit of product)
- Line efficiency (Average)
