Free tool

WIP Calculator: How Much Cash and Lead Time Is Sitting on Your Shop Floor?

Enter a few numbers from your shop. The calculator shows how long a job spends in your shop on average, how much cash your work-in-progress ties up, and what you'd gain by cutting it. Everything runs in your browser: nothing you type is sent or saved.

Your shop

The example numbers are filled in so you can see how it works. Replace them with yours.

Jobs released to the floor but not yet shipped, including ones waiting, on hold or out for processing.

Material plus the work already done on it. Not sure? A rough starting point is half to two-thirds of your average order value.

₹

Your normal weekly output, averaged over the last month or two.

Interest on your working capital or overdraft.

Your results

Average lead time (time a job spends in your shop)

Cash sitting on your floor

Cost of that money alone

With % less WIP ( open jobs), same output:

Average lead time
Cash freed
Money cost saved
Discuss my result on WhatsApp

Opens WhatsApp with your results typed in. Nothing is sent unless you press send.

How the calculator works

Average lead time uses Little's Law, a basic rule of any production system: average lead time = work in progress ÷ output. With 60 open jobs and 15 jobs shipped a week, an average job spends 4 weeks in the shop. At 6 working days a week, that's 24 working days.

Cash on the floor is open jobs × average value per job. Cost of that money is the cash × your yearly cost of money.

The reduction assumes the shop keeps the same weekly output with fewer jobs on the floor, which is what usually happens: extra WIP mostly waits in queues rather than adding output. Lead time and cash fall in the same proportion.

What it leaves out: it's an average, so individual jobs will be faster or slower. And it counts only the cost of money. The real cost of WIP also includes floor space, handling, damage and rework, parts made for orders that change, and the expediting that long queues cause. So treat the money figures as the minimum.

For the full method, including the accounting formula for WIP and how to count it on the floor, read How to Calculate WIP in a CNC Job Shop. To understand why WIP grows in the first place, read Why Your WIP Keeps Increasing.

inventory_2

Too Much Cash on the Floor?

In an Operational Workflow Review, we find where jobs wait in your shop, why work is released faster than it can be finished, and what it takes to cut WIP without losing output.

chat expand_less