Shop rates

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cutter

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Registered: 2011-11-23

Message 1 of 8

 Shop rates
24-09-2008 09:00 . pm | View his/her posts only
Curious to know what the shops involved in the forum charge for A, design and creation of a part or for just general cad time. B to machine a part on both manual and cnc equipment. primarily milling but also some turning. The real debate here in my mind is what do I charge my customers for cad time when they do not have a clue as to how to build what they want. I decided a short time ago after spending some time drawing stuff for a customer and then not being used that there needed to be a design fee no matter if they did or did not hire me to build it if they could not provide a set of accurate drawings for their design for me to bid and work off of.

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OldForumPost

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Registered: 2012-1-14

Message 2 of 8

26-09-2008 08:04 . am | View his/her posts only
Hi Cutter

Most people use the rule of thumb on this; aka suck it.

Look at a program called QuoteCAM (no this is NOT another CAM program) http://www.quotecam.com.au/ This handy tool allows you to cost EXACTLY allowing for machine purchase, job quantity, overheads +++ That way no more sucking!

Ockert

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randy

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Registered: 2011-5-21

Message 3 of 8

21-10-2008 08:39 . am | View his/her posts only
Hi Cutter,

I have seen pricing from 30 an hour to 120 an hour for design work. It depends greatly on if you do simple designs and blueprints(30-40) or if you are doing product design (60-80) and development with cost and design parameters to follow. Mold and Die work fetches nice money if you know what you are doing and if you use VX because you generally don't waste time healing models.

As far as machine time in PA it runs from 36 an hour to around 45 an hour with hardmilling rates a bit more.

Hope this helps.

GreatLakes3D CAD/CAM

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ChrisWard2k2

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Registered: 2011-11-22

Message 4 of 8

21-10-2008 09:18 . am | View his/her posts only
Hi cutter

You certainly need to ensure that all cards are on the table concerning up-front costs if the customer does not have any proper drawings. It is inevitable that once you start defining a CAD model based on "what they have", engineering problems will come to light - then it's a face-off between manufacturing requirements and design requirements, decisions that have to be agreed with the customer.

The difficulty is that if you only offer an hourly rate for the CAD work, the customer is going to be concerned that the costs will be practically never ending. So, they want a fixed price but in giving a fixed price, it is easy to sell yourself short by underestimating the time it will take. Much depends too on whether this is a regular customer or a one-off job. With regular customers, you can take the rough with the smooth, take the long-term view.

So, my advice is to give a fixed price for producing CAD data that is sufficient to work from, but be very up front and ensure the customer understands that any modifications required will be charged extra at an hourly rate. If the job is substantial, you could ask other companies for sub-contract quotes. This will help you get a good feel for the current market pricing too.

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cutter

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Message 5 of 8

21-10-2008 12:48 . pm | View his/her posts only
Thanks Randy for the reply. You are the first one in several forums that has actually mentioned per hour fees, which is what I was looking for. What types of cad work have you seen at both ends of the spectrum that commands the prices you have mentioned if I may ask? On the machine time, is this milling, turning,cnc, manual or what? Around here, Nashville TN, the per hour has dropped but still seems to be $45 to $55 per hr for a Haasvf3 size mill.
Chris, you are so right on the cards on the table up front stuff. Recently decided that no one else was giving away design work so neither was I. I designed a 3d model for a customer that they liked and then find out that the design invoice was not going to be paid because the "job" had not been awarded to me. My mistake for not telling them here is the cost to design and sign here if you want it BEFORE I DO IT. And they sent my design to two other plants to boot. Lessons learned here were never let them see a single thing, not even a concept, for any reason until they agree to a fee. The very next time this comes up they are going to have a few basic decisions to make. 1 Provide me with fabrication ready prints to bid off of, which they can't do. 2 PAY me for my time and ability which they are to cheap to keep on staff their own design wonk. 3 Be told if they do not want to pay me that I am not a design engineer and they need to go somewhere else for this item. I was warned about companies that will squeeze you if they can for free cad work and sadly have found this is surely true. It's kind of sad to see a plant manager of a facility in a company that has 27 production units around the world get all choked up about how much software and training for 3d cad costs, [ he personaly would not spend it in his plant as it is just too much!!!] and then turn around and deny that expense exists for me and want it for free. Next time will be interesting for him to say the least. In regards to the fixed price stuff, I know they want to know what their up front costs will be as I do too. But there are time where I tell them it is time and material or I will give a fixed price. But on this job with these potential problems I am going to give you a wildly inflated price to cover for the unknown or unforseen if you insist on fixed pricing. These turn out to be VERY profitable quite often and they pay for the lack of trust when they fear time and material. Thanks for the time guys.

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Paul

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Registered: 2011-9-17

Message 6 of 8

21-10-2008 03:13 . pm | View his/her posts only
Hi Kevin,

I haven't commented 'til now cos' our currency is in a different part of the planet to yours.

Kiwi dollar trading at US$0.62 at present . Was a 0.78 a few weeks back so not good for folks here.

I have on client who has a load of design work stacked up for years to come. I an given a loose brief on an existing product that they wish to do their own verion of with improved design and increased features whilst maintaining price relativity. I add a great deal of intellectual value and come up with a couple of options/pros and cons etc. and styling direction. (We patented the last one) On approval I spend time designing for production. e.g. knowing how it will be made make it makeable. Then I supervise the RPT and testing and development. Once we commit to production, I produce all the models, tooling, 2D stuff and Process control sheets for manufacturing (I dont like the last bit - tedium ..) and communicate directly with suppliers. I also source buy in components, specify etc. In effect I do it all.

So what is it worth??? I charge a flat rate of $NZ45/hr and have done for 3 years. I charge out effective time. This is where it comes unstuck. I have run into many modelling problems with VX. Some are my own ignorance others are bugs or capabilty issues. Filleting is one of the biggest nuisances as we cast most bits. So many hours are spent trying to solve 'problems' the customer really shouldn't pay for as they are not his fault.

My customer pays the VX annual. I am a one man band SOHO in the country. I make a living, not a fortune and enjoy the lifestyle.

I also have an arrangement that after two years, they pay a royalty on sales of product developed by me where my contribution os over and above drawing. 2% of FIS. And should they sell the business. I get a percentage of sales of the product in the preseeding 12mths. this covers the increased value of the business due to the added value in the product.

This is a tight relationship and I am never questioned on the bill. My rate is lower than most would charge locally.

Observations: Design jobs ALWAYS take a great deal more effort than you ever dreamed, otherwise someone else would have already done it. Perhaps up to 3 x the optimistic first estimate.
The relationship between client and designer has to exist at a personal level. If you don't click and are able to communicate with them it may not work. If you do, then you can grow the relationship if your design skills are good.

I've blabbed much more than I intended. And Randy, thanks for the upfront too.

Cheers

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cutter

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Registered: 2011-11-23

Message 7 of 8

21-10-2008 09:57 . pm | View his/her posts only
Paul, intersting point about what you feel you can charge a customer for. I had never charged a customer for cad design when I was still "going to school" so to speak as I knew my hours for the job were way above what they should be. Felt comfortable enough with what I was doing at the beginning of this year to start demanding to be paid for this stuff or refuse to do it. But it is hard to determine justifyable billable hours sometimes when you are learning or when you have software issues which have happened all to often. Another part of the problem with billable hours for me is I know in all fairness I can't charge my customer for the considerable extra time it takes to create sheet metal parts over what it should take as it is a known weakness in VX and I can't punish my customer for this. Like you I charge for "effective hours" and sometimes it is a fraction of actual for problems exactly as you mention. One of my biggest problems has been never trusting translations until I verified it with a couple of other cad aps and I bet it cost me at least 30 hours of time I did not get paid for in the last year. Very hard to figure out what to charge with all the variables sometimes.

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warren

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Registered: 2004-10-28

Message 8 of 8

14-12-2008 01:47 . pm | View his/her posts only
$75 an hour for new clients because I have so many existing clients. Many people gasp BUT the other engineering shops in town are in the $120 hour range. This will also help rid yourself of people who will waste your time endlessly quoting projects and if they are serious this price is cheap. Especially when you look at any local automobile repair shop and see they charge the same shop rate.

Of course you should always be open for negotiating. I have worked for profit shares or products in the past. You have to take the risk though. I've done $10s of thousands worth of design time only to have the company go bankrupt but that's part of the game. Once in a while I take a charity job if it will get me a new client or a good reference. As for machine time... I would charge the same. Half to pay for the actual machine and the other half to pay yourself for being the technician.
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