Re: OT: need advice from machinists

Posted by BobMo on September 10, 2005 at 19:34:15 from (208.27.172.91):

In Reply to: OT: need advice from machinists posted by Midwest redneck on September 10, 2005 at 15:50:54:

Mr. Redneck my good man.
Unfortunately you are way off base. Having been an estimator, machine planner & purchasing manager for a large engineering firm for more than 30 years let me assist you.
The rates you charge can not be arbitrary but must be based on costs. These costs are an accumulation of equipment costs, space cost, power, and other supplies. On top of that you must add cost of material with markup and your wages. Your wages are what ever you may want to draw for your labor. Your equipment costs are based on maintenance cost and declining worth with per hour cost for replacement. (Example) if you buy an old lath for 5000 dollars and you think it will run for 5000 hours but by replacement time it will cost 10,000 to replace you must put in 2 per hour into a sinking fund for replacement of that unit. That goes for all equipment in your shop.
Space may appear to be free but it is not. Be realistic. You have 2 types of overhead costs. Fixed which includes rent or building payments. (Things which do not change) Fluctuating which change monthly, power, tools (expendable) and wages.
Remember there are 2 types of machine shops. Those going into business and those going out. Those going into business usually wind up cutting the throat of their competitors and their own at the same time.
I’m not taking anything away from your ability but the best machinist in the world a good businessman does not necessarily make.
Good luck in what ever you choose to do.

Follow Ups:

• Re: OT: need advice from machinists Davis In SC 19:58:10 09/10/05 (1)
  • Re: OT: need advice from machinists george md 22:31:26 09/10/05 (0)

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