Second shift or buy another machine? Price both before you choose

The machine runs flat out. Orders are queued, and customers are asking for dates you can’t give. You have three ways to make more: run it longer on overtime, add a second shift, or buy another machine. They look similar on the shop floor and very different on a spreadsheet.

Here’s how to put dollars against each, using the actual award numbers, so the choice rests on figures rather than instinct.

Which is cheaper: overtime, a second shift or a second machine?

In the short run, a second shift beats overtime on cost per machine hour. In the long run, a second machine beats both, but only if the extra work lasts.

Option	Starts	Cash outlay	Main risk
Overtime	Immediately	Wages at 150% to 200%	Fatigue, refusals, cost per hour
Second shift	Once staffed	Wages at 115% (afternoon or night)	Hiring, supervision, a half-empty roster
Second machine	After delivery and install	Purchase or finance, plus an operator	Repayments if the work dries up

Those wage figures come from the Manufacturing Award. If you’re under a different award or an enterprise agreement, swap in your own loadings; the method doesn’t change.

What do overtime and shift loadings cost under the award?

Under the Manufacturing and Associated Industries and Occupations Award 2020, the main loadings are:

• Weekday overtime (day worker): 150% of the ordinary hourly rate for the first 3 hours, then 200%.
• Saturday overtime (day worker): 150% for the first 3 hours, then 200%, with a minimum payment of 4 hours.
• Sunday overtime: 200%, with a minimum payment of 3 hours.
• Afternoon or night shift: 115%. Afternoon shifts finish after 6pm and at or before midnight. Night shifts finish after midnight and at or before 8am.
• Permanent night shift: 130%.
• Saturday shifts: 150%. Sunday and public holiday shifts attract higher rates again.

Two rules catch owners out. Overtime must, where reasonably practicable, leave an employee at least 10 consecutive hours off duty between working days. If someone is instructed to resume work without that break, they’re paid 200% until released. And overtime is for “reasonable” extra hours: an employee can refuse unreasonable ones, so overtime is a weaker foundation for capacity than it looks.

Rates also moved recently. The Fair Work Commission raised modern award minimum rates by 4.75% from the first full pay period starting on or after 1 July 2026, per the Fair Work Ombudsman. Any sum you ran last year needs redoing.

Illustrative example: a workshop that needs 30 more machine hours a week

Illustrative only: invented figures, no real business, and wages are before on-costs, which add to every option.

A small metal-parts workshop has one CNC machine running a day shift. Orders need about 30 more machine hours a week. Assume an operator’s ordinary rate of $35 an hour.

Option A: overtime. Six hours of overtime a day over five days. The first 3 hours cost $52.50 (150%), the next 3 hours cost $70 (200%). That’s $367.50 a day, or about $1,838 a week for 30 hours, roughly $95,500 over 52 weeks. The effective rate is about $61 per machine hour.

Option B: afternoon shift. A part-time afternoon crew for 30 hours a week at 115% costs $40.25 an hour, or about $1,208 a week, roughly $62,800 a year. That’s $40.25 per machine hour, but it assumes you can staff it, supervise it and fill it.

Option C: a second machine. Say the machine costs $180,000 and the total dollar cost of finance over five years comes to $40,000, so $220,000 all in, or $44,000 a year. Add an operator working 30 hours a week at ordinary time: $1,050 a week, about $54,600 a year. Year-one running cost is roughly $98,600, close to overtime. But from year two, as work grows, each extra hour on that machine is just labour. And you now have two machines, so a breakdown no longer stops production.

The pattern is typical. Overtime is cheapest to start and dearest to continue. A shift is cheapest over a year if you can staff it. The machine costs most up front and least per hour over its life, if there’s enough work to use it.

Run your own version through the cost of waiting calculator, putting the overtime premium in as the cost of making do. If the machine looks like the winner, you can check your options before you commit to a supplier.

When does buying the machine beat running more shifts?

The machine wins when three things line up:

1. The extra work is proven. Signed contracts, repeat customers or a long order book, not a good month.
2. You’d otherwise need more than one shift’s worth of hours. Past about 40 extra machine hours a week, a shift has to run most of the week anyway, and the labour is the same either way.
3. Downtime hurts. If your single machine is also your single point of failure, a second one is insurance as well as capacity. See the hidden costs of old equipment.

It also helps if you’re already turning customers away. Our page on turning away work shows how to price that loss, and it’s often the biggest number in the whole comparison.

If you decide a machine is right, the tax side is worth a conversation with your accountant. The ATO’s instant asset write-off covers eligible assets under $20,000 for businesses with turnover under $10 million. Many production machines cost far more, and the asset must be first used or installed ready for use in the income year, so delivery and commissioning dates matter. Read our guide to installed ready for use by 30 June before assuming a June purchase lands in the right year.

When does a second shift beat buying?

A shift is the better call when the demand is real but uncertain. You can switch a shift off in a week. You can’t switch off a repayment.

It also wins when:

• the surge is seasonal and you know it ends;
• you have the people, or can hire casuals who’d welcome afternoon hours (see hiring now or waiting);
• the delivery and installation window for the machine is long, so a shift covers the gap;
• the floor space, power or compliance work for a second machine isn’t ready.

A word on casuals: loadings stack differently depending on the award and on whether the person is casual, so check the current pay guide for your own situation before building a roster around casual rates.

When is waiting the smarter call?

Sometimes none of the three is right yet. Waiting wins when:

• you can’t point to orders beyond the next quarter;
• the bottleneck is actually scheduling, setup time or a slow downstream step, not machine hours. Fixing that is free;
• price, quality or yield on your current machine is the real issue, not capacity;
• a model or supplier price change is due and you can plan around it (see supplier lead times).

The honest test: if the extra work disappeared in six months, which option would you regret least? Overtime and a shift both fade away. A machine stays on the books.

How do I run the comparison on my own numbers?

Four steps, one page:

1. Measure the gap. How many extra machine hours a week do the orders really need, and for how long?
2. Price each route over 12 months. Use your award’s current pay guide for overtime and shift loadings, including on-costs. For the machine, use the total dollar cost of finance plus an operator.
3. Add the cost of doing nothing. Lost orders, late fees and customers who go elsewhere.
4. Stress-test it. Cut the extra work by a third. Does the machine still stack up?

If it passes step 4, you have a decision. If not, you have a plan for a shift, and a date to look again.

Thinking a second machine might be the answer?

Good, because that’s a decision worth making with numbers on the table. Once you’ve done the sums above, a short conversation with one of our lending specialists can tell you whether the machine is fundable on your figures, and what a sensible structure looks like. Our 60-second enquiry asks what you want to buy, roughly what it costs and what your business turns over. There’s no credit check when you enquire, so asking won’t touch your credit file.

We also don’t send your details to a pile of lenders. A real person reads your answers, looks at your situation and calls you. Please fill the form in accurately, including the real quote and your real turnover, so we can match the right option the first time. And if the sums say run a shift instead, we’ll say so.

See if you qualify →