Enter the blank, the operations with time and hour rate, and the batch size to get the cost of each good part, the selling price with overhead and margin, and the batch total.
Pre-sizing and estimating tool: results do not replace design, calculations or reports signed by a licensed professional, nor verification against the applicable codes and standards.
Each share of the direct cost of one good part, largest first; scrap shows on its own.
Setup is spread over the parts in the batch: small batches cost more. The dashed line is the current batch.
Take this page’s results to another calculator with the fields already filled in.
The calculation report gathers this page's inputs, results, equations, assumptions and references, with fields for project, engineer and revision. The full report also includes the charts and interpretations, in color. In the print dialog, choose Save as PDF.
It builds the quote for a machined part the way a job shop does: blank material, time on each machine, setup spread over the batch, tooling, outside services, scrap and finally overhead and margin. The result is the cost of each good part, the selling price, the batch total and the price per pound of part. Use it to answer RFQs and to check whether your current price covers costs.
The hour rate adds up machine depreciation and interest, energy, maintenance, floor space, the burdened operator wage and a share of plant overhead, divided by productive hours per year. Work it out in the machine hour cost calculator (button at the bottom of the page) and bring the value into the list. Big differences between lathes and machining centers are normal.
In the example, a steel part made from 2 in bar with a 5.19 in cut length weighs 4.62 lb as a blank and 2.6 lb finished. Net material costs $5.38, the five operations take 10.8 min and $15.06, the $276.50 setup per batch adds $1.38 a part and 3% scrap adds $0.65. Direct cost is $23.88 and price $32.71; the 200-part batch comes to $6,541, or $12.58 per lb of finished part.
Because overhead and margin are percentages of the selling price, not of cost. With 12% overhead and 15% margin, 73% of the price is left to cover cost: price = $23.88 ÷ 0.73 = $32.71, a multiplier markup of 1.370. Applying the 27% on cost would give $30.32, and the real margin would fall well short of 15%. US sales tax is normally added on the invoice, so the tax field defaults to zero.
Setup is paid once per batch, so it weighs more on small batches. In the example direct cost is $23.88 at 200 parts, rises to $28.02 at 50 parts and drops to $22.84 at 800. The second chart shows this curve: for small orders, charge a minimum lot price or combine orders.
Freight, special packaging, financing of payment terms, the bar remnant left at the end of the batch, rework, special inspection and material certs are not included. Sales tax, resale exemptions and state rules vary: check with your accountant before adding taxes into the price.
There is no single figure: it depends on the machine, the region and your costs. The safe path is to work out each machine’s hour rate and apply the overhead and margin divisor; in the example, a CNC lathe costing $95 an hour becomes about $130 an hour in the price ($95 ÷ 0.73). Then compare the price per pound of part with past quotes for similar parts.
Important notice: Indus Metrics tools produce estimates and pre-sizing results from the data you enter and from published engineering methods. They do not replace design, calculations or reports signed by a licensed professional engineer (PE), nor verification against the applicable codes, standards and regulations, such as OSHA rules and the ASME codes. Material and fuel properties vary: check manufacturer data or your own process analyses before deciding. By using this site you agree to the Terms of Use.
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