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Shop hourly rate for large horizontal boring mills?

I can't believe some of you guys are billing so low. I guess that's why paying 30-35 an hour to the help is out of the question industry wide.

Rates are dropping because of cost sensitivity. We do relatively complex five axis machining here. I haven't moved my shop rate for quoting in about 3 years. We used to have a pretty solid RFQ win rate, but in the last six months I have been getting constant feedback that we are too expensive, and the work is drying up fast. As an owner, one has to do decide; do you drop rates, or just run out of work and start laying off?
 
Food truck. Time moves on.
I have been trying to encourage my oldest daughter into doing a food truck, She and her long term boyfriend are both Chefs, for restaurants in Vancouver BC, they could make a killing with their own food truck. Only issue being, very hard to start as a side gig when working in that industry, as any time you would want to be running the truck your expected to be working.
 
I can't believe some of you guys are billing so low. I guess that's why paying 30-35 an hour to the help is out of the question industry wide.

I have a few friends in the HVAC and electrical space that make a good living with a 60K worth of tools. Even so, I get to work in air conditioned spaces and leave machines to make money while I'm off in bed sleeping.

Everyone wants to compare to the higher HVAC earners but I never spend my days upside down in a 120 degree crawl space to make a buck.

$60k? My electrical work assortment for tools is well under $10k. if I need a man lift, or anything specialty wise its built in to the quote and rented.

Totally agree though, I prefer working in my shop and running machines vs hanging off a ladder or crawling through an attic, or under an oily greasy machine in a hot dirty shop, changing out a motor or sensor. Yesterday I did both, ran machines until 3pm, and then did a 4 hour electrical service call, while one of the cnc machines kept running. luckily it was an often repeat job I have proven programs for.
 
...in the last six months I have been getting constant feedback that we are too expensive, and the work is drying up fast. As an owner, one has to do decide; do you drop rates, or just run out of work and start laying off?
If you know you're operating efficiently, then hold firm on pricing, 'cause if you don't, if you join the race to the bottom, you'll end up at the bottom, and lay off/ close anyway.
 
Rates are dropping because of cost sensitivity. We do relatively complex five axis machining here. I haven't moved my shop rate for quoting in about 3 years. We used to have a pretty solid RFQ win rate, but in the last six months I have been getting constant feedback that we are too expensive, and the work is drying up fast. As an owner, one has to do decide; do you drop rates, or just run out of work and start laying off?
Maybe hold on until some more fat in the industry boils off (lots of auctions lately) and then they all come back begging for you to do their work because they can't find anyone, quality is crap elsewhere, can't hit lead times yada yada yada.

If cash flow can support it,maybe lay everyone off and take a nice 6 month vacation then reassess?
 
Friend hired a contractor to cut a slot in in concrete floor in the plant. 4" pad. Wide open area. 2 guys showed up and laid out the work. About 1 hour in one left. The other worked about 6 hours cleaned up and left.

$7000.

And this is the kind of money contractors charge around here.
 
I've had a couple people tell me house painters are charging about $1000/day + materials.
 
break down your running cost as precisely as possible and work from that



for a fairly big operation here we are about $170 an hour average with total hourly cost around $192 an hour



we own our premises and run 60% on solar power
 
Rates are dropping because of cost sensitivity. We do relatively complex five axis machining here. I haven't moved my shop rate for quoting in about 3 years. We used to have a pretty solid RFQ win rate, but in the last six months I have been getting constant feedback that we are too expensive, and the work is drying up fast. As an owner, one has to do decide; do you drop rates, or just run out of work and start laying off?
I have had some feedback about being too high but then get the work anyway once they realize other shops blow the lead time or otherwise drop the ball.

I was told by one engineer I was 4x too high on small qty prototype parts but had a meeting last week with his boss that I would likely be seeing the production qty even though my production price was not as low as the alleged price on the low qty from the competition.

Regardless of what my shop rate is, I am routinely producing parts in 50-70% of the quoted times which makes the calculated rate sort of irrelevant. Obviously a true production shop needs to be tuned in much finer than that.
 
Can’t help but look at the ROI on the machine in question. Million dollar machine and it is grossing around $100/hr? That seems low. That’s around a 1/4 million a year if it is operating every billable working hour ( 8hr * 5 days * 52 weeks). So I run a business that cost me about 1/4 million in equipment. When we are running, the whole operation generates about $1,700/hr when gross $$ are divided by the machine run hours. One factor is that I cannot run this machinery 52 weeks a year. It is weather sensitive and seasonal.
 








 
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