Quote Build Workflow
Quote build workflow: route the part, estimate cycle time, validate MRR and power, build shop rate, then apply margin and risk rules.
Shop Rate Calculation: Know Your True Cost
Most job shops use a single "shop rate" — $85/hour, $120/hour, etc. But this blended rate hides the real economics: a 5-axis Hermle running at $200/hour shouldn't be quoted at the same rate as a 20-year-old Haas VF-2 at $85/hour. Calculating machine-specific rates gives you competitive advantage:
| Cost Component | Old Haas VF-2 | New 5-Axis HMC | How to Calculate |
|---|---|---|---|
| Machine depreciation | $3/hr | $25/hr | Purchase price ÷ (useful life years × annual hours) |
| Financing cost | $0 (paid off) | $8/hr | Monthly payment × 12 ÷ annual spindle hours |
| Maintenance | $5/hr | $12/hr | Annual PM + repair budget ÷ annual hours |
| Tooling (consumable) | $8/hr | $15/hr | Monthly insert/endmill spend ÷ monthly hours |
| Operator labor (loaded) | $30/hr | $30/hr | Wage × 1.35 (benefits, tax, insurance) |
| Facility overhead | $10/hr | $10/hr | Rent + utilities + insurance ÷ total machine hours |
| Programming (amortized) | $5/hr | $15/hr | Programming hours × programmer rate ÷ parts per batch |
| Total Machine Rate | $61/hr | $115/hr | Cost basis — add profit margin on top |
Machining Time Estimation
The largest variable in CNC quoting is machining time estimation. Industry data shows that experienced estimators are accurate to ±20% — meaning a job quoted at 60 minutes will take between 48 and 72 minutes. This ±20% error directly hits your profit margin.
Systematic estimation approach:
- Count the features: List every hole, pocket, face, thread, and chamfer. Each has a predictable cycle time based on material and tool.
- Estimate per feature: Drilled holes: 3–10 sec each. Tapped holes: 5–15 sec. Pockets: calculate based on MRR. Faces: feed rate × length.
- Add non-cutting time: Tool changes (3–8 sec each), rapids between features, probing cycles. Typically adds 15–25% to pure cutting time.
- Add setup time (amortized): Divide total setup time by batch quantity. A 60-min setup on 10 parts = 6 min/part. On 100 parts = 36 sec/part.
- Apply shop factor: Multiply estimate × 1.15 for a well-run shop, × 1.30 for a typical shop. This captures micro-interruptions, measurement pauses, and program checks.
Use our Machining Time Calculator and MRR Calculator to build more accurate estimates from cutting parameters.
Automated Quoting Governance: 2026 Trends
Automated quoting software is transforming how job shops estimate and respond to RFQs:
- Feature recognition from CAD models (Paperless Parts, Spanflug, DigiFabster) can estimate machining time within ±10-15% for standard prismatic parts — significantly faster than manual estimation.
- Machine learning refinement: These systems improve accuracy over time by comparing estimated vs actual cycle times from your shop floor data.
- Digital RFQ platforms reduce quote turnaround from days to hours, with automated material cost lookups and instant pricing.
- CAM-integrated quoting (Mastercam + CloudNC/LimitlessCNC) generates toolpath-based estimates that are more accurate than feature-counting methods.
- Limitations: Automated quoting excels at standard work (brackets, plates, simple turned parts). For complex 5-axis, tight-tolerance, or exotic-material jobs, experienced estimators still outperform. Many shops use automation for first-pass estimates and have a senior estimator review before sending.
Material Cost & Markup
Material cost is straightforward but the waste factor catches many shops. A part that requires a 3" × 3" × 2" billet doesn't cost 18 cubic inches of material — it costs the closest standard bar size sawn to length, plus kerf waste, plus the stub end you can't use:
- Standard markup: 15–25% on material cost. This covers purchasing time, incoming inspection, storage, and handling.
- Waste factor by machining type: Prismatic parts from billet: 30–70% waste. Turned parts from bar: 10–30% waste. Near-net castings/forgings: 5–15% waste.
- Exotic material surcharge: Titanium, Inconel, PEEK — add a risk premium (10–20%) for potential scrap and higher tooling consumption.
Cost-Plus vs Value-Based Pricing
| Factor | Cost-Plus | Value-Based |
|---|---|---|
| Formula | Cost × (1 + margin%) | Price = customer's alternative cost |
| When to use | Commodity work, competitive bids | Specialized capability, urgency, tight tolerance |
| Typical margin | 15–30% | 30–100%+ |
| Risk | Margin erosion in price wars | Losing bids if competitors can also deliver |
| Example | Standard 3-axis aluminum bracket | 5-axis titanium aerospace part, 48-hour turnaround |
Frequently Asked Questions
Should I include programming time in the quote?
Always. Programming is a real cost — either amortize it across the batch (preferred for repeat jobs) or list it as an NRE (non-recurring engineering) line item (preferred for first-time jobs). For repeat orders, the initial programming is already paid; quote only the machining cost. For first orders, transparency about programming cost builds trust.
How do I quote rush jobs?
Standard rush premiums: 24-hour turnaround: 50–100% premium. 48-hour: 25–50%. 1-week (from standard 3-week lead): 15–25%. The premium compensates for disrupting your production schedule, overtime labor, and expedited material procurement. Always communicate the premium upfront — never surprise the customer on the invoice.
Should I use automated quoting software?
For standard parts, yes — it dramatically speeds up response time. Automated quoting works best for brackets, plates, simple turned parts, and other repeatable geometries where feature recognition is reliable. For complex 5-axis, tight-tolerance, or exotic-material work, experienced estimators still outperform algorithms. A common approach: use automation for the first-pass estimate (~80% of quotes), then have a senior estimator review complex jobs before sending. The ROI is in responding faster — shops that quote within 4 hours win 60%+ more work than those that take 48 hours.