what should I charge

[DONNYBRASS]

hello everyone,
I just got this job. But I have no idea what I should charge and how to even collect the payment. it goes something like this Its a 20pcs job, I priced the material 400dallors, tolling I figure 300 dallors, and it will take me 2 to 3 days to finnish the job. can someone tell me how I should charge or even collect the money . thanks hope someone can give me some advice

[DJPLAST]

How did you land a job without a price tag on it already?
Based on 8 hour days, 16 hours vs 24 hours is a dramatic difference.
Shop rate of $100 per hr, that would be $1600 or $2400, quite a spread.
What is the tooling cost of $300? Are these general purpose end mills/cutters or something specific (custom) for this job?
Material, mark up 15-20%.
So far it looks as though the total job would be $3180/20=$159 each part in lots of 20.
Will the customer pay this? If he agrees, go for it. Collect COD.

[spoiledbrat]

If your CNC is made of wood, or it cuts at less than 300 ipm (when it needs to), your machining rate is probably not quite $100.

If this is a metal-working job, then I am completely wrong, and disregard all.

Good luck.

[DONNYBRASS]

Originally Posted by DJPLAST How did you land a job without a price tag on it already? Based on 8 hour days, 16 hours vs 24 hours is a dramatic difference. Shop rate of $100 per hr, that would be $1600 or $2400, quite a spread. What is the tooling cost of $300? Are these general purpose end mills/cutters or something specific (custom) for this job? Material, mark up 15-20%. So far it looks as though the total job would be $3180/20=$159 each part in lots of 20. Will the customer pay this? If he agrees, go for it. Collect COD.

thanks for the quick reply. and sorry for the misunderstanding on( landing the job) i havent got the job jet, I am starting out and I didnt know how to qoute the job or even collect the money, I have heard of half up front and the rest when the job is done.anyways all this looks like its going to be a learning experiance, by the way you mention lots of 20,what about if it was one or two parts should I still go by the same hourly rate. thanks again
this looks like its going to be a long road ahead

[DJPLAST]

You will need to determine what the market will bear in your field. The $100 per hour is for a "Plastic Injection Mold" building facility. That is what we charge for our time and talent, no less, even for "simple jobs". You want it made cheaper go to a cheaper shop. No discussion.
If you are competeing with shops in your area, you will have to either work faster, more efficiently or charge less per hour to keep yourself competetive.
The reference to lots of 20 forces the customer to order and pay for all 20 pcs. Some customers will have you quote 20 pieces and then only want 4 for the same price each.
We have customers have us quote 10000 pc runs and then want 500 pcs for the same price. That does not pencil out. They learn the hard way and sometimes get upset. Better to have them get upset than us go broke.

[ImanCarrot]

We have customers have us quote 10000 pc runs and then want 500 pcs for the same price. That does not pencil out

I get the same all the time.

I tell them in black and white what the costs are for 1, 5, 10, 100 and 1000.

Occassionaly I'll do a loss leader on one off prototype work, but never twice for the same customer- do NOT be fooled by crap like "If you can make this one part for like nothing we'll give you an order for a zillion next month.. if it works...", invariably they are the same people who say things like "oh, your cheque is in the post".

I check all customers for credit references, if ok then they get 30 days to pay, if not I'll want a post dated cheque or Bank guarantee, but I'm talking quite big lumps of cash here.

Making things is nice, but don't forget you're in this to make money, everything else is just trimmings.

GET EVERYTHING IN WRITING

Also, on your Terms and Conditions, if you're adding tooling costs then make sure that it's clear who ends up owning the tooling. It's also attractive to state that this is a "non- recurring" tooling cost (ie next time he orders the same parts you'll chop off the tooling costs).

[DONNYBRASS]

Originally Posted by ImanCarrot I get the same all the time. I tell them in black and white what the costs are for 1, 5, 10, 100 and 1000. Occassionaly I'll do a loss leader on one off prototype work, but never twice for the same customer- do NOT be fooled by crap like "If you can make this one part for like nothing we'll give you an order for a zillion next month.. if it works...", invariably they are the same people who say things like "oh, your cheque is in the post". I check all customers for credit references, if ok then they get 30 days to pay, if not I'll want a post dated cheque or Bank guarantee, but I'm talking quite big lumps of cash here. Making things is nice, but don't forget you're in this to make money, everything else is just trimmings. GET EVERYTHING IN WRITING Also, on your Terms and Conditions, if you're adding tooling costs then make sure that it's clear who ends up owning the tooling. It's also attractive to state that this is a "non- recurring" tooling cost (ie next time he orders the same parts you'll chop off the tooling costs).

that was going to be my next question how does this tooling thing work.
I make the tooling ,they pay for the tooling , should I give them the tooling if they asked for it or do I just give them a mest up tooling.
what do you mean by "non-recurring". does that mean they have the rights to that tooling but they dont own it.
hope I made some kind of sence.thanks again.

[ImanCarrot]

Most customers are happy to let you keep the tooling, but I've had customers who want it part marked and reserve the right to have the tooling when the job's finished- depends on the job and cost of tooing.

Non- recurring: split the quote into:
Material £xx.xx
Machined parts: £xx.xx 1-5 pieces, £xx.xx 5-20 pieces etc
Tooling (non- recurring): £xx.xx
The fact that the tooling cost will not be charged again should your customer wish more of the parts made at a later date ensures that you have a better chance of getting a repeat order- he won't have to pay the tooling costs again and so will be more likely to place the order with yourself rather than a competitor who would charge for the tooling again. You benefit too since your setup time will be less having the tooling in your shop

[Rally]

I would recommend to be more flexible with the Payment. Most bigger Companies don't want to pay up front or after a job is done.
Net 30 seems to be a preferred payment arrangement. That will be good for bookkeeping in most businesses.

[DONNYBRASS]

Originally Posted by Rally I would recommend to be more flexible with the Payment. Most bigger Companies don't want to pay up front or after a job is done. Net 30 seems to be a preferred payment arrangement. That will be good for bookkeeping in most businesses.

thanks for the reply I did thought about the 30 day net but since I am just starting out I am asking for C.O.D thats because I dont know the venders good enough and also that way I know I dont have to wait . thanks again