Priced by the Minute: Working Out What an Hour Offline Really Costs Your Business

Ask a business owner what an outage would cost and the answer is usually a shrug followed by a guess. Ask the same question after a four-hour outage on a wet Tuesday in November, and the answer becomes considerably more precise — and considerably more painful.

The problem is that downtime is invisible on any balance sheet. Nobody invoices you for the orders that never arrived or the customers who rang once, gave up, and rang a competitor. Yet those losses are real, and they can be quantified. This article sets out a straightforward method for doing exactly that, and for using the result to decide how much resilience your business genuinely needs.

Start With the Revenue Clock

The first figure to establish is gross revenue per working hour. Take your annual turnover, divide by the number of working days, then by the working hours in a day. A firm turning over £600,000 across 230 working days and eight-hour days is generating roughly £326 per hour. That is the headline rate — but not all of it disappears during an outage.

The next question is dependency: what proportion of that revenue actually flows through your connection? A consultancy that could decamp to a coffee shop and keep working loses far less per hour than an e-commerce retailer whose checkout, stock system and payment gateway all sit behind the router. Be honest here. Most businesses overestimate their flexibility in the abstract and underestimate it in the moment.

Add the People Cost

Revenue loss is only half the sum. During an outage, staff do not simply pause — they idle, grumble, and occasionally make things worse. Calculate your total hourly employment cost: salaries, National Insurance, pension contributions, overheads. Ten staff at an average fully-loaded cost of £30 per hour represents £300 per hour of collective thumb-twiddling.

There is also the recovery tax. When connectivity returns, the first hour is rarely productive. Backlogs of email must be cleared, failed uploads restarted, orders re-keyed. A practical rule of thumb is to add 20–30 per cent to your outage estimate for the clean-up afterwards.

Price the Intangibles

Two further costs resist tidy arithmetic but deserve a line in your workings.

Reputation. A customer who cannot reach you does not know your line is down; they simply know you were unreachable. Research consistently shows that a meaningful share of customers will not return after a single poor experience. If your average customer lifetime value is £2,000, a handful of lost callers per outage carries a heavy price.

Contractual exposure. Some sectors — legal, financial, healthcare-adjacent services — carry service-level commitments of their own. If your SLA promises 99.9 per cent availability, an outage may trigger penalties or, worse, a breach of regulatory obligations.

Building the Downtime Budget

Now assemble the figures. Suppose our example firm loses 60 per cent of revenue during an outage, employs ten staff, and adds recovery time:

• Lost revenue: £326 × 60% = £196/hour
• Idle staff: £300/hour
• Recovery overhead: roughly £100 per incident

That is approximately £500 for the first hour and £496 for each hour thereafter. A single four-hour outage costs the best part of £2,000. Two or three such incidents a year — unremarkable on a standard residential-grade connection — and you are approaching £6,000 annually.

This figure is your downtime budget: the ceiling on what resilience is worth spending.

Matching Budget to Infrastructure

With the number in hand, the procurement decision becomes refreshingly mechanical.

Under roughly £1,000 per year of exposure: a standard business broadband package with a robust router is probably adequate. Accept the risk; the maths does not justify more.

£1,000–£4,000: add a failover connection. A second line on a different network — often a fixed wireless or 4G/5G service with automatic failover at the router — typically costs £30–£60 per month. It will not prevent every outage, but it eliminates the common single-point failures.

£4,000 and above, or where outages are intolerable: a leased line enters the conversation. Dedicated, symmetrical and backed by meaningful SLAs with compensation attached, it converts reliability from a hope into a contractual promise. For firms whose entire operation depends on connectivity, the premium is routinely justified by the arithmetic above.

A Final Word on Honesty

The most common error in this exercise is optimism — assuming staff will find useful work, customers will patiently retry, and outages will be brief. They rarely are. Run the calculation with pessimistic assumptions, and if the resulting figure makes you wince, that discomfort is the business case writing itself.

Downtime cannot be eliminated entirely. But it can be priced, budgeted for, and engineered down to a level your business can genuinely afford — and that process begins with a calculator and one honest hour at a desk.