Supply Chain Disruption Calculator
Supply disruption revenue impact.
Calculate revenue at risk from a supply chain disruption based on outage duration, inventory buffer, and post-disruption recovery rate.
What this tool does
Revenue at risk from a supply chain disruption depends on duration against inventory buffer, with recovery rate determining how quickly revenue rebuilds afterwards. This calculator estimates the revenue exposure created when a disruption exceeds your inventory buffer period. It shows how many days of sales fall outside your protective stock level, then applies your recovery percentage to model the portion of daily revenue that remains unrecovered during that window. The result illustrates the financial impact under your specified conditions. Daily revenue, disruption length, buffer days, and recovery rate drive the output most significantly. A typical scenario might involve a production delay lasting longer than safety stock can cover, with gradual sales restoration over time. The calculation assumes linear daily revenue and recovery patterns, and does not account for fixed costs, customer retention effects, or supply chain complexity beyond these parameters.
Quick answer: with the default values, the result is $300,000.00 (Revenue at Risk). Adjust the values below for your own figures.
Enter Values
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Formula Used
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Calculations or display — let us know.
Disclaimer
Results are estimates for educational purposes only. They do not constitute financial advice. Consult a qualified professional before making financial decisions.
Supply chain disruptions cost businesses revenue when inventory runs out and orders can't be fulfilled. This calculator models the financial impact: daily revenue × exposed days (disruption minus inventory buffer) × unrecoverable percentage. Helps quantify whether safety stock investment is worth the carrying cost.
50k daily revenue, 30-day disruption, 10-day inventory buffer = 20 exposed days. At 30% unrecoverable (70% can be sourced alternatively) = 300k revenue at risk. That 300k justifies significant safety stock and dual-sourcing investment. Most businesses discover this math only after the disruption hits.
COVID and Suez Canal taught hard lessons. Businesses with 30-60 days inventory weathered 2020 supply shocks. Those with just-in-time (3-5 days) suffered immediately. Post-2020 trend: inventory buffers up 20-40% across manufacturing, retail adding 2-4 weeks buffer vs pre-COVID levels. The carrying cost is insurance against disruption.
Run it with sensible defaults
Using daily revenue of 50,000, disruption duration of 30, inventory buffer of 10, revenue recovery of 70%, the calculation works out to 300,000.00. The defaults are meant as a starting point, not a recommendation.
The levers in this calculation
The inputs — Daily Revenue, Disruption Duration (days), Inventory Buffer (days), and Revenue Recovery % — do not pull with equal force. Not every input has equal weight. Adjusting one input at a time toward extreme values shows which ones move the result most.
How the math works
Exposed days = max(0, disruption - buffer). Revenue at risk = exposed × daily revenue × (1 - recovery %).
Using this as a check-in
Running this every three months shows a trend rather than a single snapshot. One reading shows where things stand; several over time show whether they are improving. The trend matters more than any individual reading.
What this doesn't capture
The result reflects only the inputs you provide and the assumptions built into the formula. It is a simplified model rather than a complete picture, and factors specific to your situation may matter just as much.
£50,000/day × (30 - 10 buffer) × (1 - 70%) = $300,000.00.
Inputs
| Exposed Days | 20 days |
|---|---|
| Mitigated Revenue | $700,000.00 |
| Buffer Days | 10 days |
| Disruption Duration | 30 days |
This example uses typical values for illustration. Adjust the inputs above to match a specific situation and see how the result changes.
Sources & Methodology
Methodology
The calculator computes potential revenue loss from supply chain disruption by first determining the number of exposed days—the period when disruption exceeds your inventory buffer. It calculates exposed days as the maximum of zero or the difference between total disruption duration and buffer inventory days. Revenue at risk is then computed by multiplying exposed days by your daily revenue figure, then applying the revenue recovery percentage as a reduction factor. This models the assumption that disruption impact scales linearly with duration and that recovery is uniform across the exposure period. The calculator does not account for operational costs, fixed overhead retention, customer attrition effects, or the timing of when recovery occurs relative to disruption onset.
References
Frequently Asked Questions
How to set recovery %?
What disruption length to plan for?
Inventory buffer vs insurance?
Cost of buffer vs cost of disruption?
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