machine shop rates.

[jon0]

Hello

I've just been reading the 'What is the average hourly pay for cnc operators in your state' thread. I was wondering what the average machine shop rates are in your area, if you're able to pay your employees over $40 an hour you must have a fairly high rate. From a customers side, I recently sent out for quotes on some work which differed by almost 600%, so I'm just curious.

[Tormachmaster]

It really depends on the type of shop you want to make your parts a good one will never be under $65 per hour and that would be super cheap and for prototypes much , much higher.

[Boots]

jon0,

One of the reasons you are getting such a varance in quotes could be because of the different equipment in each shop varies greatly. If I give you a quote for cutting a 1 1/2 in. keyway it will be higher than the guy that has a Broach because he can do it much faster. That's just an example of what can happen with quotes. Get quotes with the shops that have the equipment to do what you want then you might see less of a spread on the figures.

[Dualkit]

You need another column, I know for a fact some people are charging $30 an hour and less. You can get away with that if you have machines that an operator can run 2 or more of. I have adjusted my rates to fit the economy, right now it is $40 an hour per machine. Depending on what is on them, I can run up to 3 at a time. In 2005 before my business took a complete dump, I was charging $75-$100 an hour depending on complexity of the work. $75 an hour for the feed 12 foot bars, check the part once a day jobs, $100 an hour for the ones that required attention. I used to sell to the limousine industry, that sector has disappeared. I ran a similar poll on hourly profit and it ran way lower than this one, which I find odd. I think a lot of people do not bill all hours worked.

[Dualkit]

Originally Posted by Boots jon0, One of the reasons you are getting such a varance in quotes could be because of the different equipment in each shop varies greatly. If I give you a quote for cutting a 1 1/2 in. keyway it will be higher than the guy that has a Broach because he can do it much faster. That's just an example of what can happen with quotes. Get quotes with the shops that have the equipment to do what you want then you might see less of a spread on the figures.

So true! I think the quote variation comes more from cycle times than rates. I have seen others quote 3 minutes a part for ones I drop in 45 seconds.

[machinechick]

Seems the rates have been the same ($60-$80 per hour) for the past 10 15 years (midwest). The wages for the people that do the actual machining haven't improved much either, and they sure didn't anywhere keep up with inflation.
Frankly, I don't see how people can stay in business. Out of about 6 shops I worked in only two are still in business and they are very small outfits; the big places that had heavy duty contracts or made their own products are LONG gone! The excuses for the low pay/rates first was the Japanese and Koreans, then Mexico, now it's ALL in China. Kinda funny how the Communists (who protect their economy) turned out to be the only large scale manufacturers left.
Oh well, c'est la vie, guess I should have been a CEO or something. Never really could figure out what those people that live in those 'burb mansions did for money, (not machining/manufacturing) there sure seems to be an awful lot of them though!

[diyengineer]

There will always be a niche industry that needs a product. Innovation and filling a need will always put money in the bank. Instead of doing "jobs" or random work, one could always start a online business and fill a "need" as well. Let the monster tycoons produce what they like where they like. Start thinking about yourself, your machines and what you can produce for the world (even if you have 1 knee mill and a single car garage). Just look what it did for William Boeing or Henry Ford. Times have changed evolve, or go extinct.

[Dualkit]

Originally Posted by diyengineer There will always be a niche industry that needs a product. Innovation and filling a need will always put money in the bank. Instead of doing "jobs" or random work, one could always start a online business and fill a "need" as well. Let the monster tycoons produce what they like where they like. Start thinking about yourself, your machines and what you can produce for the world (even if you have 1 knee mill and a single car garage). Just look what it did for William Boeing or Henry Ford. Times have changed evolve, or go extinct.

That worked good for me for a short time, the niche industry I served "Limousine Manufacturers" managed to almost evaporate overnight once I grabbed market share and refined the manufacturing of the products to create $100-$200 an hour profits. I went from 23 steady customers in 2006 to 1 in 2010, most of them went out of business, now I am just doing random job shop work I found through open bidding, at least the customers are coming back direct with out going through the open bidding process. I does take a long time to build a customer base this way. I have excellent quality
and pricing by being able to cycle parts faster than most, but I am horrible as a salesman.

[Runner4404spd]

the real problem is alot of shops are used to doing gravy work for ridiculous prices. alot of shops did aluminum, brass, even mild steel parts. all these can be done cheaper and fast in china as their wages are low and they keep machines running 24/7. in reality, shops need to evolve away from gravy work and take on more challenging things. we had a bunch of shops jump in and try and bid on government work and were really low balling the heck out of it not understanding that they had a ton of requirements and piles of paperwork to justify it. luckily our government doesn't always choose the lowest bidders but its been touch and go even for those contracts. one day you got them and next they are gone or cut back or whatever. i agree that you need to find a product line and make something yourself. then you control your destiny as long as there is a need for your parts or until the copies come out.

also i don't know of any shops paying their employees $40/hr unless its the owners. and even that for an owners salary is very low once you count all the aggrevation that goes into owning a business.

[skullworks]

I run a dual tiered pricing structure that is available only if it is requested up front. ( First question I ask is: "Is job this time sensitive?" and if they say it is I usually won't offer the option.)

I have my normal shop rate and delivery schedule and the "standby" rate which is about 30% less. "Standby" jobs are put up between normal work when I am waiting on tooling or materials for normal work. If business is slow I will do all scheduled maintenance and in house jobs before running "standby" work.

At the initial quote time you can request it quoted both ways. Generally speaking once the price has been given I won't go back and quote it for "standby".

To get "standby" rates you have 10 days to accept the quote and pay ALL material costs up front. The only way this works is if we have everything on hand ready to go should a schedule opening occur. If the job consists of a package of different parts we will deliver and invoice each group of parts as they are completed. If the job becomes time critical and needs to be moved to the active schedule then normal shop rates will be used.

[machinechick]

You know it really gets tiring hearing the same old Adam Smith bullroar about wages/productivity being the cause of lost work. Perhaps this was a valid concept back in the day when we were really competing against other companies that were trying to make a profit, and basically all things were equal. The growth in American productivity never stopped the bleeding of jobs. The degradation of our work conditions (eg. lack of so called gravy work, gee wouldn't want anything to ever be nice and easy; I'd rather run three machines with three differnet jobs at the same time and work extra hours for no overtime) didn't stop the hemorrhaging of jobs. Everytime I buy anything from China (don't have much choice anymore) I don't know who's the bigger fool, us for letting the stuff in the country or them for selling it at a loss just to try and destroy us (seems to be working huh?) You tell me with a straight face that the raw material in most anything you buy from China doesn't cost more than the item itself!! If not please let me know where you get your stock so I can get in on the deal! Are we all going to end up living in Party provided apartments and eat in communal dining halls the same meal three times a day? (thats who your wanting to "compete" with). Almost every other nation has an industrial policy to protect their national interests, ours was to give tax breaks if you outsourced to falsely bouy up the corporate balance sheets and give the muckity mucks "compensation bonuses", guess someone has to live nice and easy huh? Whats really going on?

[stuby]

Originally Posted by Runner4404spd the real problem is alot of shops are used to doing gravy work for ridiculous prices. alot of shops did aluminum, brass, even mild steel parts. all these can be done cheaper and fast in china as their wages are low and they keep machines running 24/7. in reality, shops need to evolve away from gravy work and take on more challenging things. .

Alot of the stuff we have been doing for the last year is all crazy stuff ,turning tungsten shafts in a lathe,grinding synthetic saphire,or milling 60 to 70 Rc parts th only thing keeping us alive lately is the cazy jobs no one else will take on.I think your exactly right about the gravy work,.. its all washed up and gone!!