Nonconformance Cost Calculator
What does each nonconformance really cost? Use this free calculator to estimate the internal cost of nonconforming product — scrapped material, rework, re-inspection, and the time spent documenting and dispositioning each NCR.
Your Numbers
How many nonconformances (NCRs) your plant records in a typical month.
Share dispositioned as scrap.
Average material/part value lost when a nonconformance is scrapped.
Share dispositioned as rework. Scrapped + reworked should total 100% or less — the rest is use-as-is, return-to-vendor, and so on.
Labor to rework one nonconforming part or lot.
Labor to re-inspect after rework or to verify the disposition.
Writing up the NCR, investigation, review/MRB, and recording the disposition.
Wages plus benefits/overhead for the people doing this work.
Estimated Result
Cost per nonconformance
$219
Monthly nonconformance cost
$4,380
Annual nonconformance cost
$52,560
Labor hours on nonconformances
64.0 hrs/mo
Where the cost goes (per month)
Illustrative scenarios: fewer nonconformances
- 10% fewer nonconformances~2.0/mo ($5,256/yr)
- 25% fewer nonconformances~5.0/mo ($13,140/yr)
- 50% fewer nonconformances~10.0/mo ($26,280/yr)
These are illustrative scenarios showing what fewer nonconformances would be worth at your numbers — not a promise or a guaranteed QualTrue result. Actual outcomes depend on your process.
How the calculation works
This calculator is for QA managers and plant leaders who want a realistic figure for what nonconformances cost internally. It adds up four costs for a typical nonconformance, then scales them to your monthly volume.
Cost per nonconformance = (% scrapped × material cost per scrapped nonconformance) + [(% reworked × rework hours) + re-inspection hours + NCR documentation hours] × fully loaded hourly labor cost. Monthly cost = cost per nonconformance × nonconformances per month. Annual cost = monthly cost × 12.
It deliberately counts internal costs only. Customer returns, chargebacks, warranty claims, expediting, and lost business are left out because they vary too much to estimate from a few inputs — so for most plants the true cost is higher than this figure.
Realistic example
A plant records 20 nonconformances a month. About 30% are scrapped at roughly $250 of material each, and 60% are reworked at about 2 hours each. Every nonconformance also takes around half an hour to re-inspect and an hour and a half to document, review, and disposition. At $45/hour, that's about $219 per nonconformance — roughly $4,380 a month, or $52,560 a year, before counting anything that reaches the customer.
Related Tools
- Inspection Record Completeness ScoreAudit a sample of inspection records and score how complete they are — and which missing element shows up most.
- Manufacturing Inspection Administration Cost CalculatorEstimate how much re-keying, searching for records, and corrections are costing your quality team every month.
Keep every nonconformance record clear and complete.
QualTrue gives QA a clear record to review, approve, or flag — see how it works.