View Full Version : hourly shop rates?

05-22-2009, 02:36 PM
I'm sure this will differ alot due to location and specialty,but what do most of ya'll charge as an hourly rate? Input from casual partimers and full time pro's is appreciated?

05-22-2009, 03:01 PM
next job in 5 minutes , cash for consumables at cost, labour in beer and fish- hey its Friday.

05-22-2009, 03:19 PM
Do not charge by the hour, but by the job!!!
I do this for a living as well as a hobby.
Being a "one man shop" I use carbides, build jigs for repete jobs,
have several machines so that I can set up many items at one time etc.
All to get more done in less time. Time = money.
If I charged by the hour I would go back to a flat belt drive lathe and a bench top mill (Not that there is anything wrong with these items, just it is hard to make money with them :) )

If it's a repair job, then how much is the replacement
use the 50% rule.You did not charge the customer 50% of replacement cost you saved him 50%. So what if it only took 1.5 hours!!

If you charge, charge enough!

Frank Ford
05-22-2009, 03:26 PM
In my home shop I do some stuff for pals for nothing, and some stuff for pay.

That said, when I wanted to figure out an hourly labor rate, here's the way I went about it.

I think it makes sense to base my hourly rate on a “reasonable” yearly work schedule of 40 hours a week, with two weeks off for vacation. That’s 50 weeks @ 40 hours, or 2,000 hours a year.

If I know what income I need at the bottom line, I can work backward to calculate an hourly rate.

First, I need to know my general “efficiency,” the number of hours I spend actually working at the bench rather than talking to customers, schlepping materials and parts, tool maintenance, cleanup, book work and other functions that keep my shop going. Working strictly alone, I figure that I spend somewhere near 50% of my time doing the bench work, and 50% doing all that other stuff.

Now I have a 1,000 hours at the bench to generate my income for the year.

For example, if my fixed expenses - rent, utilities, insurance, supplies, insurance, etc. - amount to $50,000 for the entire year - I need to deduct that from my gross income to know what I’ll actually make.

In this example, then, if I want to have an income of $50,000 for the year, I’ll have to include my expenses which are also $50,000, for a total of $100,000. Dividing by my billable hours (1,000) I’ve arrived at an hourly rate of $100.

AND, with that $50,000 income, I’ll have to pay Federal and state income taxes, my own health care, and try to save for my own retirement. . .

05-22-2009, 03:46 PM
Over here we never charge by an hourly rate. All charging by the hour does is pi$$ off the customer. They always think you should have been able to run it faster and you are trying to screw them. An upfront per job or per piece price keeps everybody happy.

You do need to have an hourly rate that you keep internal to yourself, but it depends on what you're doing. Is it something that can go on that seldom used machine in the corner and chug away by itself for hours on end, little to no set up and its not going to eat tools. That going to get priced cheap. A job that requires constant babysitting, days of set up and fixture design, lots of specialty tools, thats getting priced through the roof.

Also you need to keep in mind what the market will bear. If you get a quote and its a part you know is going for $1000 a part and you KNOW you can knock them out in 20 minutes, do you quote it at 20 minutes of time???? Hell no, you back it up to $900 and make yourself $2700 an hour, everybody is happy.

So, over here we usually base our quotes on $75 an hour, but depending on what it is, and who its for, the risk involved, the skill involved, somewhere between $20 and $1500 an hour.

05-22-2009, 08:29 PM
I'm retired and run my shop for spending money. I charge from $25 to $75 per hr but I don't tell the customer that, I give them a price for the job after I decide how long it will take.

Most customers today don't want to hear an hourly rate, they want a price for the whole job or cost per piece.

The reason for the wide spread of hourly rate is because of who it's for. I decide what the customer will bear and what it is worth. For businesses doing resale, it's the higher fees, for indivuals it's a lower fee depending on what it is.

When I bid a bunch of pieces I make one to see how long it will take. If it's a one off I bid high and may cut the price if it takes a lot less than what I figured. For a good customer that makes them feel your honest and reasonable. They know I won't jerk them around on the price and they treat me the same or they take it somewhere else.

05-22-2009, 08:55 PM
Where is "over here" Bob??

05-22-2009, 09:12 PM
Where is "over here" Bob??

Hatch, New Mexico, just added it.

Rich Carlstedt
05-22-2009, 09:38 PM
A good reference is your local automobile dealer hourly rate.
Now I know some of you will say the auto mechanics have nothing to do with machine shops, but what I observed over the years, is the Auto dealers have big overheads and have to support that. Getting quotes from shops is some of what I did when I worked, and it struck me one day how close the relationship was.. seemed to be within 5 dollars of most job shops
Shops around Green Bay charge 95 dollars an hour..
If, and thats a big IF , I was to ever job out my shop, thats the rate I would charge.
I don't do that however, because when I did it many years ago, I had too many deadbeats on my customer list.
Here is advice, that I learned the hard way..
When your friends tell you they have a friend who needs work done in a shop and he is having a hard time finding someone to do it because it is a small job..
Run like heck and slam the door ....he is a none payer..
Worse mistake I ever made was not getting money upfront and before the job is done. It totaled me out in 6 months


05-23-2009, 06:05 AM
In my home shop I usually look at my tools availablele and estimate the time.
I then take what I get at work as a Tool a Diemaker on Overtime as my base rate for an hourly rate, times the time estimate.
If the job is a repeat, then I usualy have figured out how to do it and have the proper tools narrowed down.

05-23-2009, 06:32 AM
This is not you for to decide, obama will decide.

05-23-2009, 12:05 PM
65/hour for manual machine jobs and the same for machine repair, 80/hour for CNC work

About half of my customers are time and material, I've done enough work for them that they know they are getting a fair price, every once in awhile someone will complain like Bobw53 mentioned, so I tell them to take their business elsewhere, its always sweet when they come back with their tail between their legs and I get to fix the POS part they had made by some garage machinist(sorry guys :) ).