Aerospace & Defense Manufacturing worked example

Defense Delivery Penalty Exposure at 54% enforceable penalty share: a worked example

This worked example runs the defense delivery penalty exposure numbers for a tougher week than the baseline: 54% enforceable penalty share instead of the typical 75%. Estimate delivery penalty exposure from late contract units, penalty per unit, enforceable share, and fixed recovery cost.

The inputs for this scenario

  • Late defense deliverable units: 14 units (held at the documented default)
  • Penalty exposure per unit: 4,200 $ / unit (held at the documented default)
  • Enforceable penalty share: 54 % (the input this scenario stresses; the baseline uses 75)
  • Fixed expedite or recovery cost: 18,500 $ (held at the documented default)

Working through the calculation

  • The calculation starts from the formula this tool documents: Enforceable penalty cost = late units × penalty per unit × enforceable penalty share.
  • Defense delivery penalty exposure works out to 50,252 $ penalty exposure at these inputs, and this is the headline figure for the scenario.
  • Penalty exposure per unit works out to 3,589 $ / unit at these inputs.
  • Enforceable penalty cost works out to 31,752 $ penalty exposure at these inputs.
  • Fixed expedite or recovery cost works out to 18,500 $ at these inputs.

How this compares with the baseline

  • Against the tool's baseline example, where enforceable penalty share sits at 75% and the headline result is 62,600 $ penalty exposure, this scenario comes in 19.73% below the baseline at 50,252 $ penalty exposure.
  • Use it when a defense delivery is slipping and you must weigh paying penalties against spending to recover the schedule. A result at this level usually justifies acting on the stressed input before touching anything else, because every other figure in the table is downstream of it.

Results at a glance

  • Defense delivery penalty exposure: 50,252 $ penalty exposure (headline result)
  • Penalty exposure per unit: 3,589 $ / unit
  • Enforceable penalty cost: 31,752 $ penalty exposure
  • Fixed expedite or recovery cost: 18,500 $

Run it with your numbers

  • To rerun this with your own numbers, open the live Defense Delivery Penalty Exposure calculator, set enforceable penalty share to your actual value, and adjust the remaining inputs to match your operation.

Last reviewed 2026-05-12.