Hourly rates for Brother Speedio-type of machines

I feel like a total noob for asking this question, but what is a sensible hourly rate for a Brother Speedio (or Robodrill and other machines like this) kind of machines? Thus; shoe-boxed sized product, 3-, 4-, 5-axis, entry level machines.

P.S. I'm in western Europe.

My references for costs of machines and hourly rates are all on machines for products >3m. I'm really new to the small stuff and I'm afraid I will be completely off when it comes ot my estimates. We do some part-time machine building (mechatronics) and doing the machining of the mechanical parts myself would really speed up the prototyping. However, in order to make it a sensible investment I will for sure have to do some additional machining for other companies in my area. I want to see how much turnover we can realistically generate with that.

- What COST do you calculate with? Is it with or without programming?
(I assume material is always charged separately)
- Which machine do you have, what was the price of the machine and what % of the hourly rate is the machine?
- What % is the operator?
- What % is consumables (tools, coolant, electricity)?
- What % is maintenance?
- What am I missing?

I will do some mor searching on the forum, and asking around to local machine shops.

Depends on how good you are, and what your clientele can afford. If you're a noob making car parts, maybe $50/hr. If you're a master making medical and aerospace, maybe $200/hr.

The answer is as much as possible but buyers don't understand is they want a "which leaves you a lot of real time room to make thousands of dollars per hour adversely if you're going to use time and materials that is the biggest waste of shoptime as far as compensation values go. Buyers are completely clueless to how powerful the quote is. The quote allows you to be ingenious about how you set up amd how fast the machine moves and how quickly you can get those parts out. And also allows you some flexibility into filling those time slots that you wouldn't be using through your ingenuity for other quoted jobs. A smart buyer would send a few quotes your way and then ask you to provide T and M on a contractual basis this saves the buyer quite a bit of margin. But most buyers are classically trained to pick just the smallest fee see for quotes. So as far as shoprate goes you try to shoot for an average to good shoprate in your area and for the type of work that you want to do and a lot of times that is dictated by by the actual equipment and overhead that you have. Some of these Cnc's allowed a greater value in a smaller workspace. Employee compensation May seem pretty steep at 1st but should become a small percentage of overall overhead in the long run. It's expected to pay at least higher wages currently with the market for labor in most 1st world countries being pretty poor to none. Most employees will seek benefits and benefit packages and that can be something that you can iron out at a later time and you can use methods like 2 weeks of paid vacation and some paid holidays to buy yourself some time to see how your business is going to develop.

Clearly you're missing quite a bit of business strategy and basic knowledge of successful and progressive machine shop methods but that's OK you're learning we all learn we go through some of these learning curves sometimes we pay for it with bankruptcy and sometimes we pay you know we get compensated really well. But you can fail at something that that was a secondary Passion without ever 1st seeking your primary Passion so my advice is to seek your primary Passion whenever possible and be motivated.

Simple business sense. You can't charge more than the customer is willing to pay for that particular piece, in your particular location. One customer may be willing to pay 50 eu and another will be willing to pay 150 eu. Knowing which is which takes practice.

I rephrased the question as the answers are a bit too obvious. Sure you want to find customers that are willing to pay more

But I'm also sure there must be some shop owners operating these small machines that look at their costs as well.... and some that are willing to share their way-of-working there. So what are your calculated/estimated hourly machine costs? And what % do you allocate for machine depreciation, maintenance, consumables, the person operating it, etc.?

My experience with higher paying customers is that they also demand a bit more. Like design optimization to be able to make the part on the machine at all, or much more documentation with the part. In my models that is another thing and I'm looking purely at machining now.

Lets say you were making a customers parts on a 3 axis knee mill, and they were happy with the pricing, but for you it was really arseholes and elbows to get the work done. But that said you are making 100 bucks an hour when you do their work

You buy a Speedio

Should you charge 100 bucks an hour?

I think not.

That said, if you are getting into volume production of parts, say thousands a week, other people will be quoting those parts who have a different perspective and cost structure. On lower volume parts this is not such a big issue.

A buyer can ask whatever they want, but my time, my materials is my business, not theirs.

Which brings up material.

How many jobs will you do that the cost of the part is less than twice the material?
I you use at all expensive material, there becomes a hard bottom limit to the price you charge, regardless of time

gustafson said:

Lets say you were making a customers parts on a 3 axis knee mill, and they were happy with the pricing, but for you it was really arseholes and elbows to get the work done. But that said you are making 100 bucks an hour when you do their work

You buy a Speedio

Should you charge 100 bucks an hour?

I think not.

That said, if you are getting into volume production of parts, say thousands a week, other people will be quoting those parts who have a different perspective and cost structure. On lower volume parts this is not such a big issue.

A buyer can ask whatever they want, but my time, my materials is my business, not theirs.

Which brings up material.

How many jobs will you do that the cost of the part is less than twice the material?
I you use at all expensive material, there becomes a hard bottom limit to the price you charge, regardless of time

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Gus is correct. It is difficult to put a price on each machine and stay in business. Most service businesses set a rate and try to stick to it. If you have to go to an extremely expensive machine, ( say you are turning a piece that needs a 48 inch swing lathe ) then going over your shop rate will be justified, and the customer will understand. You are asking a question that a lot of beginners ask. I'm not saying you are a beginner, but it is the same question. A hard question to answer. Sometimes your shop rate won't even cover your utilities if the job gives you trouble, and sometimes your shop rate will make you a nice profit to cover those bad days. Personally I would rather be doing a poor paying job than no job at all. But then in more than 30 years in business I have never had to go bankrupt either.

Say a part is worth $100. If it takes you two hours to make it, you're worth $50/hr. If you can make a batch of four in one hour, you're worth $400/hr.

I tried to sub a part to a guy when I was swamped. He'd just bought a $30K machine, and said he had to make $100/hr to cover his expenses. At the time I had thought he was more experienced than he was. He took five times as long as me to get anything done, and scrapped a bunch of expensive material that I had paid for. His value to me was negative. Even if he had made good parts, his value would have been about $20/hr due to the time he took.

This isn't just based on cycle time either. Things like programming and setup have a huge impact on short runs. I do a lot of onesie twosie stuff where programming and setup take significantly longer than the cycle time. When runs are longer, I can overlap programming with machine time; one-offs don't work that way.

With a lot of the stuff I run on my Speedio (prototype onesy twosie stuff) I spend way more time setup and programming. The machine will knock the part out in 20 minutes, but it was a half day work for me, so hourly rate for the machine is a little meaningless until you get some volume.

Cosmo and Mhaj are both correct. These are issues that should be thought of before purchasing your equipment. You don't buy a dump truck to fill a flower pot with dirt. Find out what your customers need. If they need one or two of each item you don't purchase a machine that is made to produce a thousand of one item. You buy a machine that doesn't need programming so you can make them efficiently, and quickly. We have all lost work because we couldn't get to it right away, and the guy down the street got the job with his rusty Bridgeport and dirty South Bend. If it is just one part don't waste time programming, just get it done, and the customer will be back. Remember computerized equipment was invented to reduce labor costs. If you have no labor costs then be careful how much you spend on computerized equipment.

mhajicek said:

Say a part is worth $100. If it takes you two hours to make it, you're worth $50/hr. If you can make a batch of four in one hour, you're worth $400/hr.

I tried to sub a part to a guy when I was swamped. He'd just bought a $30K machine, and said he had to make $100/hr to cover his expenses. At the time I had thought he was more experienced than he was. He took five times as long as me to get anything done, and scrapped a bunch of expensive material that I had paid for. His value to me was negative. Even if he had made good parts, his value would have been about $20/hr due to the time he took.

This isn't just based on cycle time either. Things like programming and setup have a huge impact on short runs. I do a lot of onesie twosie stuff where programming and setup take significantly longer than the cycle time. When runs are longer, I can overlap programming with machine time; one-offs don't work that way.

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I even knew people that had decent skills and never made scrap working in job shops, but never wanted to see where the tipping points were on feeds and speeds. This was pre internet, and I am sure plenty of those guys opened their own shop. I never stayed too long in one place before striking out on my own and was shocked at some of the things I saw, even on jobs shops had been running forever. I saw a lot of 6 minute parts you could run in 2 with only minimal increased tooling cost and down time.

CosmosK said:

With a lot of the stuff I run on my Speedio (prototype onesy twosie stuff) I spend way more time setup and programming. The machine will knock the part out in 20 minutes, but it was a half day work for me, so hourly rate for the machine is a little meaningless until you get some volume.

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This is an excellent point, a Speedio is a production machine, more production than I usually need. I actually still feel comfortable on my R2C3 CNC knee mill for onesys, but then you have to change tools.

People frequently buy machines that are more expensive than their work demands. That is probably a better mistake than buying machines that are less expensive than their work demands

Speedios are actually cheap[you already knew that because I bought one] so to me there is no other choice in that hundredy grand machine area, because even if you do not need the speed today, you may in the future

CITIZEN F16 said:

I even knew people that had decent skills and never made scrap working in job shops, but never wanted to see where the tipping points were on feeds and speeds. This was pre internet, and I am sure plenty of those guys opened their own shop. I never stayed too long in one place before striking out on my own and was shocked at some of the things I saw, even on jobs shops had been running forever. I saw a lot of 6 minute parts you could run in 2 with only minimal increased tooling cost and down time.

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Yup

I dropped 2 minutes off of an 12 minute cycle because now I am standing in front of the machine watching it.

WE have been running that part for a decade.


Part of that was a mistake. I left the feed knob at 150 percent and it ran through perfect. Well I says, I think I know what that means....

About a decade ago I was reprogramming someone else's work. Aluminum filter cap, pretty simple. I didn't even get aggressive with it, just applied reasonable parameters and techniques, and it came out at 1/4 the previous cycle time. The price the company could get for the part remained unchanged.

I just purchased a brand new Speedio. I'm charging the same amount for parts I was making on my Fadal, but a lot of the small run production items I had already proved out, I'm able to adjust and easily make it 25-50% of the time. But I also had to spend a decent chunk of change to do so. So that investment goes to me and back into my business. I have already discussed some price breaks with some of my longer term good customers, because I want them to continue to be good customers and we can both win. I feel like part of that is just good business. That being said, I have always shot for right around $100/hr, but I'm also in SoCal and lots of things are expensive, but it balances out with my low overhead setup. I feel like I can easily be more competitive on jobs I want now, because I can leverage the Speedio for items that fit what I want and I'd be willing to compromise a bit on cost for jobs that can keep the spindle turning.

I came from a Fadal 3016. The Speedio is awesome and everything I expected and better. What I severely underestimated is how much time it would save me with probing, tool setting, managing chips and just tweaking/editing programs and overall work flow. It has been a massive work flow improvement and I've barely scratched the surface of capabilities.

One part I make, I went from a block of 4 parts first op taking about 10 minutes in the Fadal, to 8 parts, complete first and second ops out of the machine, in 13:30. And that's with basically just modifying the programming I already had. I'm by no means the best at squeezing every ounce from CAM, just an average dude that wanted to learn machining and cnc.

That is good business sense. Hopefully the OP reads it.

It is confusing and depends on....
Assuming your workload is fixed faster machines or shorter cycle time need more dollars per hour.
Why,, because there are less hours to bill.
Lets take an extreme. Old machine and process takes 2000 hours per year at $50 per hour.
New wiz bang method does the same work in 2 hours.
How much per hour for the same one year worth of parts if you want to survive.
If I get faster does my incoming work and sales increase?
Fixing an hourly rate depends on much.
Tooling guys will play this as this niffy new tool is faster and worth more money.
Yes if the input of work unlimited but that is not real world.

I'm not sure if this all makes sense. Dad spent a few million on superfast grinders.
I did not understand as our sales volume still the same and now we have big machine payments.
As the SOB (son of the boss) I did the okay my job is to follow even if it seemed madness to the P&L.

Bob

Here in the states, one can hire easy-work workers for $10 an hour..but at the first next higher offer that worker will walk and you will be left short-handed.
One should visualize fair pay amounts or the business is likely to fail.

On the R450’s I use to quote at 200. Sometimes it ends up being less and sometimes more. Usually once the parts are in production I can speed things up with some tweaking…. tight rapid, optimal cutters, and just pushing the mill with high feeds and speeds. Doesn’t always work that way and some jobs need slowed down for process reliably.

Lately with inflation been quoting at 225+ and bumping the prices up slightly so far no one has complained.

Volume also plays a factor if I know a customer does 5000-10000 parts a year they might just get a quote at 150. I’ve been burnt in the past doing that but it has also worked out well for a couple customers