How to Calculate the Cost of Downtime

How to Calculate the Cost of Downtime

by Lou Chapman - June 25, 2020

How to calculate the cost of a downtime event? As a managed service provider, Arcane Strategies is committed to making sure our customers’ web-based assets are functioning 24/7/365. We are extremely proud of our 100% client retention rate and a 99% uptime rate. Keeping our clients’ websites, databases, and applications up and running is key to their success as well as ours. 

When explaining Managed Services, the cost of downtime is often the start of the conversation and sometimes the hardest to understand. Businesses rely on their web-based assets for a wide variety of processes, sometimes taking for granted that they are up and running. So we decided to create a simple calculator that takes your business’s data and shows how a prolonged downtime can affect sales.

A Downtime Event

To help show how much a downtime event can cost your business, it helps to define it. A Downtime Event is any amount of time where a web-based, business-critical, asset is no longer available for use. Website, eCommerce Shop, Database, and web application, are all examples of a web-based asset that helps you conduct business.

Downtime events can last for hours, sometimes days, on end. Most businesses are forced to take people away from current projects or tasks to solve downtime related issues. Some may even resort to hiring overpriced, ad hoc, contract work. Many of these contractors charge a higher rate due to the urgency of the situation, forcing businesses to pay for overpriced development work on top of their loss in sales. This is where Managed Services is different.

Under a Managed Services contract, the provider (Arcane Strategies) is responsible for keeping web-based assets up and running. This includes running maintenance checks, load tests, and many other performance upgrades. If there is a downtime event, you will no longer have to take employees away from their current project or hire an expensive contractor. Arcane Strategies will immediately start to take action and find a full proof and fast resolution! All while saving you from losing more sales than you would otherwise. Sound too good to be true? Use the calculator to find out how!

Calculating the Cost of Downtime

We have created a google sheet that will help you calculate the cost of a downtime event. Enter your business’s number of daily/yearly online transactions and the average price to determine how much a downtime event would cost in sales. Click on the link below to use the Google Sheet Downtime Event Cost Calculator:

Downtime Cost Calculator

Simply enter the following data about your business. The number of online transactions last year (or an estimate for this year), an average sale of each transaction, and the number of daily visitors. The calculator will show how much a 4, 6, 12, 24, and 48-hour downtime event will cost in lost sales. It then goes to show you how much you would have saved with a managed service provider like Arcane Strategies. Reducing your downtime event to 1 hour across the board.

Lastly, we included multipliers that show how much more a downtime event would cost if the event happened at peak times of business. An eCommerce site going down at 2:00 AM EST might not have the largest impact on sales, but if that same website went down at 2:00 PM EST, a lot of people are going to notice.

Want to Ensure your Website’s Uptime?

Did you just find out that you are interested in signing up for Managed Services? We can help you with that! Arcane Strategies has been helping clients keep their web-based assets up and running for several years. With clients like Rumble Boxing and Winklevoss Technologies, we have ensured their applications and website are ready to go at all times. 

You can sign up for our Managed Services right now on our store. 

Sign Up Now!

Want to learn more about how we provide the highest quality resources for a fraction of the cost of the big names? Check out this video on our Managed Services Process!