The Profitability Gap Calculator
What is the gap worth in your factory?
Enter your operation. The model returns an annual estimate built from four independent components, with the arithmetic shown. Nothing to fill in first, and nothing is sent anywhere.
Your operation
Improvement assumptions
Annual profitability gap
$1.57M
$31K per line · 7.7% of current contribution
- Annual contribution today
- $20.39M
- Annual shipment value
- $55.60M
- Annual overtime cost
- $1.22M
The four components are computed independently and do not overlap. Recovery from late delivery is capped at what is actually late today. The arithmetic is set out in full in the methodology note — a business case you cannot audit is one you cannot take to your board.
Diverzent · ProactivePlan
The Profitability Gap — estimate
Prepared for your operation
Estimated annual gap
$1.57M
$31K per line · 7.7% of current annual contribution
Where it comes from
| Allocation efficiency | $741K | Contribution gained from the same loaded minutes by running each style on the line and sequence that runs it best. Applied to loaded minutes only, at +2pp. |
| Capacity utilisation | $453K | Contribution recovered from line-hours currently idle between orders, at +2pp. Valued at current efficiency, not improved efficiency, so it cannot overlap with the component above. |
| Overtime avoided | $243K | The premium cost of overtime hours no longer required, at a 20% reduction — overtime taken only where it converts a late order to on-time. |
| Late delivery cost avoided | $133K | Shipment value moved from late to on-time, at +3pp. Capped at what is actually late today: this operation is 12pp short of full on-time delivery. |
| Total | $1.57M |
Your figures
| Sewing lines | 50 | Operators per line | 30 |
| Working days per month | 26 | Hours per day | 10 |
| Average efficiency | 55% | Line utilisation | 90% |
| Average SMV | 15 | CM per garment | $2.2 |
| FOB per garment | $6 | Loaded labour cost per hour | $0.65 |
| Overtime hours per line per month | 52 | Overtime multiplier | 2× |
| On-time delivery today | 88% | Cost of lateness | 8% |
Derived: contribution per standard minute $0.1467 · annual contribution $20.39M · annual shipment value $55.60M · annual overtime cost $1.22M.
How to read this
- Utilisation and efficiency are kept separate. Utilisation asks whether a line is loaded at all; efficiency asks how well it performs while running. Combining them double-counts the same minutes.
- The four components are mathematically independent. Computing any pair together returns exactly the sum of computing them separately.
- Recovery from late delivery is capped at what is actually late today. A factory already at 99% on-time cannot recover three percentage points.
- The financial model is a contribution and line-operating-cost model. It does not price the cost of being late beyond the component shown.
Annual profitability gap
$1.57M
How the model works
Utilisation and efficiency are kept separate. Utilisation asks whether a line is loaded at all; efficiency asks how well it performs while running. Combining them — as most vendor models do — double-counts the same minutes.
Allocation gains apply to loaded minutes only. Utilisation gains are valued at your current efficiency, not an improved one. The two cannot overlap.
Recovery from late delivery is capped at what is actually late today. A factory already at 99% on-time cannot recover three percentage points, and a model that lets it is a model your CFO will reject.
This is an estimate built on your inputs and published industry benchmarks, not a quotation or a guarantee. Its purpose is to give you a defensible number to interrogate. If you think it is wrong, we would rather hear why.
Tell us where it is wrong.
The most useful conversation we have with a factory is the one where they correct our arithmetic using their own numbers. Bring a month of your order book and we will run it properly.
We answer within one working day.