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  1. #1
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    Default Quoting Issues

    Hey everyone,

    I'm a young punk kid in the Portland area who recently purchased a Haas Mini-mill to start my own machining business and i'm in need of some advice. I'm trying to make a model for costing CNC services. Between feature based costing, hourly rates, and other methods of costing, it seems difficult to determine what the market will bear (especially as a new guy). I'd like to keep costs low, so i'll be using Excel or other freeware.

    Ideas
    Excel: Feature Based costing, price per hole, etc
    Hourly estimate + material
    Surface area * tolerance call out + material cost
    bartering with machinist friends to find out what something costs

    Potentially bad Ideas
    Dartboard Pricing
    Create 5 unique parts, get quotes from other machine shops, base incoming work on the 5 models I created
    Ask the customer what they want to pay and go up from there
    Buying quote information from a machine shop about to go out of business (probably not the best quotes)
    Machine Learning: Use a few quotes to generate a table on variables like tolerance, # of holes, etc and build an algorithm.
    Machine Learning: Partner with a few similar machine shops, pool in the quotes, CAD files, and prices, and build a quoting engine for the group.

    I currently work a different engineering job, so all of my expenses are covered, and i'm not losing sleep over my idle machine (yet)
    In the end, I'd like to specialize in machining composites, but for now I'll take what business I can get.
    Let me know what you guys think,

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    this should help you on dartboard pricing

    https://www.walmart.com/ip/Trademark...cac5223c0e4481

    all the formulas in the world aren't going to hold a candle to good old experience. And there's only one way to get that. Just don't extend yourself so that you can get kicked over hard enough that you can't get up.

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    What Cam system do you use? If I need a time study I drop the model In Featurecam and click AFR and I have a get a real close actual machine time in less than 2-3 minutes then just add material. Figuring setup time and tooling is always going to be just from good ole experience.

    Bartering with machinist friends is probably not a good idea. You have a machine and a business so you are competition now. Say for instance, Joe down the road from Acme machine is a good buddy and you ask him to help you quote some things. That to me is a direct conflict of interest and would be a terminating offense.

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    I use Fusion 360 for both CAD and CAM, and now I won't be asking my machinist friends for quote advice.

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    Good luck. So many variables. There is no cut/dry answer.

    You work an engineering job? Do you have machining experience?
    If not: owning a machine will make you a much better engineer!
    Quote low, consider it education.........

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    owning a machine will make you a much better engineer!
    Quote low, consider it education.........
    Best statement Iv'e seen on PM in a long time!!!

    Machinist and Engineers have a natural instinct to not play well with each other.

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    You could run some test parts and get an idea of time taken ..then bid about 3 times your hour rate.
    Short runs and one-ups likely need 4 times that rate.
    Out knocking on doors for work 50% of your time and need to bid more....

    Invent a Got-to-have new product and sell it on Ebay (till everybody copies it and sells it for 2 bucks.)

    Agree I know next to nothing about bidding mill work.

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    Quote Originally Posted by Erik Morris View Post
    I use Fusion 360 for both CAD and CAM, and now I won't be asking my machinist friends for quote advice.
    You can download the trial version of Featurecam and use it for time estimates just cant post code or save.

    I made a quick vid on using Featurecam to get a general idea of run times. I just used the stock software settings in the vid but you can have your cutting styles saved, step overs, DOC, materials, tools. The vids not my greatest piece of work but it gets the general idea out.

    YouTube

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    My price is based on demand multiplied by a pita factor. Try and avoid being the cheap guy. It is a hard reputation to break, and it makes more enemies than friends.

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    I know one engineer that quotes stuff and he figures everything low to me. I don't know how he makes it, but he sure makes it tough on himself using all his formula and whatnot. The only thing he's got going is he's smart enough to make it work.

    It's a lot easier to make money by not leaving money on the table. Sell yourself when you get the opportunity. Develop those skills. Fuck software. The perfect spreadsheet isn't going to make you $300/hr or land that big customer.

    That is what your people skills are for.

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    Quoting is a pain in the ass, and as far as I've ever noticed, there isn't or can't be
    an exact science to it..

    For a small guy, doing lower quantity work, its primarily experience, with a secondary
    of guessing, and third-arily of pure luck...

    There are also other things to consider. How much BULL SHIT does the customer put you
    through? How much paperwork and time is involved in that? Delivery.. Did they want
    you to do 100 quotes to get that one job? That stuff isn't free either.. Are they just
    going to sit on your invoice and not say anything and NOT PAY YOU because one letter in
    the job# is a small 'p' and not a capital 'P'... Or are they going to send your check
    to somebody else??? They have both happened to me.

    Is the customer smart enough to know what actually matters and what doesn't? Lanyard hole,
    .092" +0/-.0005, .002 true position.. And in reality the lanyard is actually .145 in
    diameter, and the location could be off by up to 3 full inches and it wouldn't effect
    a single thing.. Are they smart enough to know that? Or are they going to be up your
    ass because the hole is only .0025 within position.. And then when you waste a shitload
    of time explaining why it doesn't matter.. Come back on you because your hole is too
    small because the .145 thick lanyard doesn't fit in the .092 hole. THOSE customers get
    charged more.. I call it a "PAIN IN THE ASS multiplier".

    And then there is "Perceived Value".. Simple looking prints always go for less, always.
    Even if they are more difficult... A casting with a pile of GD&T shit all over it.. ALWAYS
    goes for more, even if its far easier and quicker to do.

    There is also how you attack the part.. Lets take a straight forward part, and I'll give you
    an example. A simple spindle, like on any truck or car in the world.. Small truck size.. 2 bearing
    journals. an inch on the outside, 1-5/8 on the inside, +0/-.001.. I had a job for 1400
    of them..

    I've mentioned this story here before.. One day, those parts were running and a local shop
    owner came in(he wanted to borrow a countersink, and I'm fine with that),
    we were friendly, he did some work for us.. And he looks at what we are running
    and says "You undercut me on those".. My asshole puckered wondering what was coming next, and
    then he says.. "Thank god, I was losing my ass on those".. I didn't have the heart to tell
    him that we were banging $275 an hour on them, with minimal tooling cost.


    Another example. Tricky little part.. At that point in time, I had 2 other experienced machinists
    above me, and we were all new working with each other.. And they were 2 pretty good guys, I'm
    face book friends with both, and talk to the other quite frequently. At that point I was still
    the "yung'n". I had all my hair and had just eclipsed 3 decades on the planet.

    A job came into the shop.. I can tell you exactly what it was/is, and where it goes, but I won't..
    Nothing super critical, but it HAD to be right(ish). HUGE money for what it was.. 75 cents in material.
    a heat treat and a passivate.. To the gov for about $125. The "shop" was getting $80 each..

    So, we all sat down and talked about it, because it was tricky.. So they are going on about all the
    custom tooling we are going to have to order, and we are going to have send back the material and
    get far oversize stock.. And I'm sitting there telling them, NO.. THIS IS STUPID SIMPLE..
    Eventually I won, and they let me do it my way.. I SAW it different than they did..

    They saw it as a part coming out of rectangular bar.. Lay it down.... NO.. double it up,
    and stand it up.. No custom tools, all standard endmills we already had in the drawer..
    A few hours to fixture it up.. And a 4 minute run time per part, being VERY conservative..
    $20 a minute.. $10 grand in a day and a half, on ONE machine.. And we were the LOW BID!!!!!

    Enough babbling.. I'm tired..

    Don't be afraid to ask if they have a target price.. Also don't be afraid to try and
    establish a relationship with the purchasing agents/customers you are working with..
    Talk to them, they are people too.. You don't have to try and get in their pants.

    Am I High?? If I did win the bid, how LOW was I compared to others?? If you don't have
    a friendly relationship, they won't let you know that stuff..



    Occasionally you get a customer that NEVER asks for a price up front.. And those
    are the worst... And the BEST.. They TRUST you, they don't go anywhere else anymore,
    unless you are swamped.. There is never any bullshit, there is never any anything negative.
    Its just a couple of people working together trying to make money, and its awesome, I have
    2 of those, and I'm very thankful for that...

    Here is one that I had free reign on.. COST and design.. "make that sucker go
    around the corner and stay flat(ish)".. A complete redesign on a machine that my customer
    has been making since 1984.. Not to say there are a lot of them out there, but this is
    the replacement for the very first one he ever built in 1984. Total re-design, while keeping
    some commonality.

    I delivered that whole mess up top Friday afternoon, took this vid this morning at 7:30am,
    and the end customer signed off on it this afternoon.



    Woops, just hit post preview, LONG post.. SORRY... And I also re-watched the video.
    I've probably got 5 grand in parts in that video alone.. Not a single one I quoted...
    "make me THIS".. "OK"..

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    Do not bid lower than your time and materials. You are not "looking for exposure". You are not "donating for a good cause". Don't be afraid to say "This is what it would cost me, with my current shop, to do that job" and walk away if needed.

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    What the hell's wrong with Dart Board Estimating??
    I use it all the time, the lowest score on my dart board is $80/hr.
    Don't knock it till ya try it.

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    Bartering with machinist friends is probably not a good idea. You have a machine and a business so you are competition now. Say for instance, Joe down the road from Acme machine is a good buddy and you ask him to help you quote some things. That to me is a direct conflict of interest and would be a terminating offense.

    I have several friends that have shops and we bounce prices off each other all the time. We don't compete and wouldn't compete.

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    I suck at quoting and I been doing this for over 35 years, medical semiconducter commercial and aerospace. aside from what wheelking said which is spot on. only advise I can offer is Do the parts right to print(not on high or low limits but at the mean Dim), Make them look nice and even, no nicks or gouges during debur no file marks, no funny mismatched finishes, clean the parts and you will be good to go. Appearance is just as important as tolerance if you do that most customers will help you on quotes.

    One thing you do have to remember is that your new and if it takes you 2 hours to make, someone who has been doing it for 5-15 years can do it in 30 mins or less. Dont rely on cad especially if your new. not to mention for it to be correct you have to set up all your machine paramters rapids speeds . it took me 4-5 years to get my code generators to be really close to what cad shows and actual times are., then you have to figure out loading and unloading time, checking time in machine if needed etc etc,

    Good luck learn while your young.

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    I have several friends that have shops and we bounce prices off each other all the time. We don't compete and wouldn't compete.
    You say this now but let some high dollar cream puff RFQ come across your desk and see who's competition and who's not. I could see that conversation.

    John calls Joe: Joe, did you see that big RFQ"?
    Joe: Yeah John, do you want to bid on it of should we let Jeff?
    John: Lets call Jeff and ask him if he wants to make more money than us.
    Joe: Good idea!
    Joe calls Jeff: Hey Jeff did you see that big RFQ that just came through?
    Jeff: Yeah, Looks like a lot of money!
    Joe: Yeah, John and I wanted to ask if you wanted to quote on it.
    Jeff: Well, Jim has been a little bit slow lately so maybe we should just let him bid on it.
    Joe: Lets call him and ask.
    Joe calls Jim: Hey Jim, Did you see that big RFQ
    Jim: Yeah, that would have been a nice one to get.
    Joe: Well, Jon, Jeff, and myself wanted to know if you wanted to bid on it.
    Jim: Oh,,, Haven't you heard? G-coder05 already bid on it, won the contract and has the materials on order!


    Moral of this: "If you are not competing with other local shops you are competing with yourself".

    Don't take this as a bashing, Look at it as a view from another perspective. Unless this is a hobby shop it's strictly business......

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    Heck if I know. I program ( roughly ) every RFQ and use the time the software generates ( along with a factor plus setup etc ). But this is VERY time consuming and exhausting.

    Im actually running a job right now that I screwed myself on. I quoted it and the customer let it "slip" that I was WAY low. I checked everything and told him I thought I was fine right there. He was sure I was messing up so I told him, " How about I run it then see how it comes out, if its higher I will requote next time". He agreed and I ran them, and surprisingly, was very close to quoted price. I told him so so now thats the price.

    A smart businessman would have at least told him he was right, and i would split the difference between my price and the next lowest.....Instead I am running them for almost half the cost of the next lowest quote.....sigh

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    I break the parts up in parts and ude my experience. Put it In a simple Excell where I have my hour rate on all the setup, programming and run time calculations.

    If you have to use more than 5 mins on quoting jobs you will be wasting alot of time on quoting.

    Sendt fra min EML-L29 med Tapatalk

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    Quote Originally Posted by pgmrmike View Post
    A smart businessman would have at least told him he was right, and i would split the difference between my price and the next lowest.....Instead I am running them for almost half the cost of the next lowest quote.....sigh
    NEVER, EVER refuse easy money when someone tries to hand you some.

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    Quoting is hard. A time study will tell you a lot, but especially for someone new it may not be accurate. If you have downtime now I would strongly suggest you spend time building and testing a tool library on a variety of parts, getting the other backend stuff setup (invoicing, templates, etc.), and learning to work efficiently in your shop.

    From one engineer to another, you will probably do much better taking parts from start to finish rather than running a job shop. Designing a product yourself makes it a lot easier to find and build into a market where you can pay yourself $300/hour and spend the weeks it takes to design and prototype the next thing to bring to market.


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