How do you calculate medical device scrap cost?

Multiply scrapped devices by the absorbed cost per device, then add fixed disposition and investigation labor. Here 30 x $45 + $500 + $350 = $2,200 total.

What is the all-in cost per scrapped device?

Divide total scrap cost by the number of scrapped devices. In this example $2,200 / 30 = $73.33 per device, well above the $45 absorbed material/labor loss alone.

Why include disposition and investigation costs in scrap?

Regulated medical scrap requires controlled destruction and a documented disposition, and most scrap triggers an investigation. Here those fixed costs add $850, lifting per-unit cost from $45 to $73.33.

Is scrap cost the same as material cost?

No. Absorbed cost includes the labor and overhead already added to the unit, so a device scrapped near final assembly costs far more than its raw materials.

What is a good scrap cost target?

There is no universal figure; benchmark scrap cost as a percent of cost of goods sold and trend it down. Even a modest scrap count becomes costly once fixed disposition and investigation are added in.

How do I lower cost per scrapped device?

Catch failures earlier to reduce absorbed cost, and batch dispositions to spread fixed disposition and investigation labor across more units rather than per event.

MedTech Manufacturing calculator

Medical Device Scrap Cost Calculator

Medical device scrap cost is the fully loaded dollar value lost when finished or in-process devices are rejected and cannot be recovered. It is more than material: it includes the absorbed labor and overhead already invested in each unit, the controlled disposition and destruction fees that regulated scrap requires, and the investigation and documentation labor that every scrap event consumes under a quality system. Operations and quality finance leaders use this all-in number to prioritize yield projects, because the per-device cost on a finished medical line is often far higher than the bill of materials suggests. Counting only material understates the true loss and misdirects improvement spend.

What this calculator does

Estimate scrap cost from rejected devices, absorbed cost per unit, disposition costs, and investigation/documentation labor.
Use this when quantifying cost of quality, justifying process improvements to reduce scrap, or reporting scrap cost to management review.
It sums the absorbed per-device loss across all scrapped units plus fixed disposition and investigation labor, then divides by units to give an all-in cost per scrapped device.

Formula used

Total medical device scrap cost = scrapped devices × absorbed cost per device + fixed disposition cost + investigation labor
Cost per unit = total scrap cost ÷ scrapped devices

Inputs explained

Scrapped devices:
Absorbed cost per scrapped device:
Fixed scrap disposition cost:
Investigation and documentation labor:

How to use the result

Use it after a scrap event or at month-end to put a defensible dollar figure on rejected devices for cost-of-quality reporting and project justification.
It uses a single absorbed cost per device, so a mix of units scrapped at different process stages (raw vs. nearly finished) will be averaged and may misstate stage-specific loss.

Current U.S. benchmarks

U.S. manufacturing runs at 75.6% of capacity with new factory orders at $657B per month (Federal Reserve and Census, May 2026).
The U.S. has 8,825 medical equipment and supplies establishments employing about 308,388 workers (Census County Business Patterns, 2023).

Common questions

How do you calculate medical device scrap cost? Multiply scrapped devices by the absorbed cost per device, then add fixed disposition and investigation labor. Here 30 x $45 + $500 + $350 = $2,200 total.
What is the all-in cost per scrapped device? Divide total scrap cost by the number of scrapped devices. In this example $2,200 / 30 = $73.33 per device, well above the $45 absorbed material/labor loss alone.
Why include disposition and investigation costs in scrap? Regulated medical scrap requires controlled destruction and a documented disposition, and most scrap triggers an investigation. Here those fixed costs add $850, lifting per-unit cost from $45 to $73.33.
Is scrap cost the same as material cost? No. Absorbed cost includes the labor and overhead already added to the unit, so a device scrapped near final assembly costs far more than its raw materials.
What is a good scrap cost target? There is no universal figure; benchmark scrap cost as a percent of cost of goods sold and trend it down. Even a modest scrap count becomes costly once fixed disposition and investigation are added in.

Last reviewed 2026-05-12.