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IndustryArena Forum > Business Practices > Business Practices / Pricing > Cost estimation and Cost estimation tools
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  1. #1
    Join Date
    Jan 2015
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    Cost estimation and Cost estimation tools

    Hi all.

    Have a question for you all. Recently our company was contacted with a request for us to quote some parts that need to be machined. While this is not our core business, we assessed our current availability and found this could be an interesting opportunity for us, to work as subcontractors and machine parts for others on our CNC machines. The trouble is we have no experience with this. While we do a lot of CNC work (lathe and mill) we have never worked for anyone outside the company and as such never estimated any jobs. Soon, we figured out that our lack of experience was a problem and that we were having a rough time estimating a cost per part. We know our internal costs, both fixed and variable. What we need is to estimate the time it'll take to machine the part. So our Work Preparation engineer set out to estimate the time. The way he is doing it is he's looking at, for example, how many holes in the part, how long it should take to drill each hole considering the tool used, cutting speeds, etc... then moving on to the next operation and doing the same (how much to mill off, how many passes the mill does until desired thickness is removed, etc...). This takes forever!!!

    So my question is: how do you guys do it? How do you estimate the time it'll take you to machine a part and how much it'll cost you?

    I'd greatly appreciate all input I can get. I know there are some tools out there, but they all seem to be done by "guessing" the time, and that isn't what we wanted. We wanted something a bit more "precise" for lack of a better word. I don't mean down to the second, but it'd be nice to have something that can estimate in the rough ballpark area.

    Thanks in advance.

  2. #2
    Join Date
    Apr 2015
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    82

    Re: Cost estimation and Cost estimation tools

    i work in construction and bid jobs everyday, while this isn't the same as what your talking about it has the same basic inputs you have to calculate

    employee time(hourly wage, benifits, insurance)
    machine time(cost of machine, wear and tear, cost of tooling)
    overhead(cost of your building, heating, cooling, office staff, pencils, pens, paper, everything else you do which isn't cutting a part)
    profit(in construction its between 10-30% depending on the job)


    after that you have your cost, if the part is complex then maybe you add more, if your not busy maybe you take it for a little less to try and stay busy...

    not the most direct answer, but food for thought.

  3. #3
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    Jan 2015
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    11

    Re: Cost estimation and Cost estimation tools

    Quote Originally Posted by jueston View Post
    i work in construction and bid jobs everyday, while this isn't the same as what your talking about it has the same basic inputs you have to calculate

    employee time(hourly wage, benifits, insurance)
    machine time(cost of machine, wear and tear, cost of tooling)
    overhead(cost of your building, heating, cooling, office staff, pencils, pens, paper, everything else you do which isn't cutting a part)
    profit(in construction its between 10-30% depending on the job)


    after that you have your cost, if the part is complex then maybe you add more, if your not busy maybe you take it for a little less to try and stay busy...

    not the most direct answer, but food for thought.
    Hey, in my book there is no such thing as a bad answer. So thanks for the input even if it isn't directly related as you stated.

    I have all the costs for the items you mentioned. Already set up in my Excel sheet (yes, I am using something as crude as Excel ).The only bit missing is to estimate the approximate time for machining. That's the part that's killing us. We are taking waaaaaay to long on that. I also still have to estimate a cost for setup and quality control, as well as estimate a cost for a new vice where we'll fix the part to be machined, but that's not much of an issue.

  4. #4
    Join Date
    Apr 2004
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    475

    Re: Cost estimation and Cost estimation tools

    Per feature usually doesn't work out. Way too low or way too high depending on either off machine and setup costs or more effective machining when all features done at once.

    So, how to do it?

    1) get experienced. I know that's not an option here but experience is the best shortcut.

    2) quote high, and the less of number 1, the higher.

    3) program a sample or similar part, perhaps simpler, but about the same amount of machine work if not programming, and use the actual or simulated runtime as the basis for the quote. Any speedups programmed later is extra profit, but those would depend on what type of runs you are talking about.

    3b) have a number of reference jobs to help rough out a cost of similar new jobs.

    4) make sure to account for waste, scrap parts, etc.

    Good luck!

  5. #5
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    Jan 2015
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    Re: Cost estimation and Cost estimation tools

    Thank gfacer. I'll also consider these points when trying to estimate. When you say to program a sample, you mean run a test program on the machine and see how long it takes, or simulate i in a CNC program? If the latter, what would you recommend? If I could find a program good enough that would let me create a virtual program and run it in a virtual environment that might also work.

  6. #6
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    Apr 2004
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    475

    Re: Cost estimation and Cost estimation tools

    Usually you'd start with whatever simulation features your current cam software offers. Otherwise there are separate simulation programs too.

  7. #7
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    Re: Cost estimation and Cost estimation tools

    Quote Originally Posted by gfacer View Post
    Usually you'd start with whatever simulation features your current cam software offers. Otherwise there are separate simulation programs too.
    *Ahem* we have no cam software. We never needed it. Usually we machine parts for our internal production and from time to time for other companies within the group. We receive the 2D drawings, interpret them, and manually make the g-code. But if we are going to start quoting and estimating, I'll have to change this way of working. Hence, right now I am open to pretty much anything as long as it allows for a speedy calculation and estimate.

    In this current case, I have asked the perspective client if they can supply 3D drawings in CAD format. I have access to SolidWorks elsewhere and was hoping I could either:
    1 - Import the CAD files and use the cost estimation feature in SW, although since I have never used it I don't quite know what that would entail.
    2 - Hopefully find some way to quickly export a rough g-code that I may then use in a simulation software (suggestions welcome) that might help me approximate the time needed.

  8. #8
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    Apr 2015
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    Re: Cost estimation and Cost estimation tools

    depending on the complexity of the part, if you have access to solidworks you can get HSMexpress free, its a great program and that might be a good start.

  9. #9
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    Jan 2015
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    Re: Cost estimation and Cost estimation tools

    Believe it or not, that's exactly what I am checking out right now. As soon as I can get to the SolidWorks PC and receive at least one part file form the client, I'll try and give it a whirl. With my limited knowledge of SW, I am guessing I am looking at a steep learning curve. In any case I'll give it my best.

  10. #10
    Join Date
    Apr 2004
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    475

    Re: Cost estimation and Cost estimation tools

    I'm guessing if you can code by hand, there are other ways to tackle it, ie hobby grade software that will take or make a dxf and do a simulation. Cambam comes to mind, but I don't use it so not 100% sure it does all that.

    Thanks,

  11. #11
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    Re: Cost estimation and Cost estimation tools

    Quote Originally Posted by gfacer View Post
    I'm guessing if you can code by hand, there are other ways to tackle it, ie hobby grade software that will take or make a dxf and do a simulation. Cambam comes to mind, but I don't use it so not 100% sure it does all that.

    Thanks,
    May be worth a look. Thanks for the pointer.

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