How do I calculate a shop rate to plug into this template?

Add annual overhead (rent, utilities, indirect labor, depreciation, consumables) plus direct machine operating cost, then divide by available spindle hours. If overhead runs 300,000 dollars and you have 3,500 productive hours, that is roughly 86 dollars per hour before adding a machine's specific power and maintenance. Many shops land between 65 and 125 dollars per hour. Run separate rates for a manual mill versus a 5-axis machining center rather than one blended number.

How should setup time be spread across quantity?

Setup is a one-time cost, so divide it by the batch quantity. A 2-hour setup at 90 dollars per hour is 180 dollars. On 10 parts that adds 18 dollars each; on 500 parts it adds only 36 cents each. This is why short runs need higher unit pricing. Always quote setup per batch, and never fold it into cycle-driven cost or you will misprice every other quantity break.

What scrap allowance should I add to material cost?

Add scrap based on your first-pass yield, not a flat guess. If you typically scrap 3 percent, multiply material by 1.03. For hard-to-machine alloys, tight tolerances, or unproven processes use 5 to 8 percent. Include drop and cutoff loss too: a 12-inch part from 12-foot bar with 0.5-inch facing and cutoff wastes material every piece. Track actual scrap and update the factor quarterly so it reflects reality.

Should I apply margin on cost or price (markup vs margin)?

This template applies margin on price, so a 30 percent margin means cost is 70 percent of the quote: divide cost by 0.70, not multiply by 1.30. On 100 dollars of cost, a 30 percent margin gives 142.86 dollars, while a 30 percent markup gives only 130 dollars. Confusing the two silently erodes profit. Pick margin, be consistent, and target 25 to 40 percent depending on competition and risk.

How do I quote multiple operations on one part?

Cost each operation separately with its own machine rate and cycle time, because a lathe op and a VMC op carry different burden rates. Sum the operation costs, add setup for each, then add material, labor, and overhead before margin. A part with turning at 75 dollars per hour and milling at 95 dollars per hour must not use a single blended rate, or you overprice the cheap op and underprice the expensive one.

How do I handle first article and inspection time in a quote?

Treat first article inspection and PPAP documentation as setup-type costs spread over the batch, plus per-piece inspection time in the cycle. A full FAIR per AS9102 can run 4 to 12 hours. On a 50-piece order that adds meaningful cost per part, so quote it as a separate line the customer can see. For recurring in-process checks, add the gauge time (say 30 seconds per part) to cycle time.

Manufacturing Cost and Quoting

Job Shop Quote Spreadsheet Template

Build a part quote by rolling up material, setup, machining time, labor, overhead, and margin into a clean customer-facing price.

Overview

This template helps job shop estimators and owners turn an RFQ drawing into a defensible price by rolling material, setup, machining time, labor, overhead, and margin into a single per-unit and total number. It is built for machine shops, fab shops, and contract manufacturers who quote small to medium batches. Guessing a price from gut feel loses money on setup-heavy short runs and loses jobs on long runs, so a structured build-up keeps every quote consistent and auditable.

The sheet takes part name and quantity, then material cost with a scrap allowance, setup time and rate, cycle time and machine rate per operation, labor rate and hours, and overhead. Setup cost divides across the quantity while cycle-driven cost scales with it, which is why the same part prices differently at 10 versus 500 pieces. Your margin percentage applies on top of full cost to produce the final quoted price and total job value.

In practice, pull material from your current supplier quote, cycle and setup times from your routing or a trial run, and rates from your shop burden calculation. Save one file per RFQ so you have a record for audit or re-quote. Duplicate the sheet to compare aluminum versus steel or a 3-op versus 2-op routing. For fast one-off estimates or a sanity check against the spreadsheet, run the Job Shop Quote Calculator alongside it.

What this template includes

Part name and quantity input
Material cost and scrap allowance
Setup time and rate
Cycle time and machine rate per operation
Labor rate and time
Overhead allocation
Margin percentage and final quoted price
Per-unit and total price summary

Suggested use case

Use this to price a new RFQ, document a quote for audit purposes, or compare cost across multiple material or process options.

How to use it

Enter part name and target quantity.
Fill in material cost from your current supplier price.
Add setup time and cycle time from your routing or estimate.
Set your margin target.
Review per-unit price and total job value.

Frequently Asked Questions

How do I calculate a shop rate to plug into this template?: Add annual overhead (rent, utilities, indirect labor, depreciation, consumables) plus direct machine operating cost, then divide by available spindle hours. If overhead runs 300,000 dollars and you have 3,500 productive hours, that is roughly 86 dollars per hour before adding a machine's specific power and maintenance. Many shops land between 65 and 125 dollars per hour. Run separate rates for a manual mill versus a 5-axis machining center rather than one blended number.
How should setup time be spread across quantity?: Setup is a one-time cost, so divide it by the batch quantity. A 2-hour setup at 90 dollars per hour is 180 dollars. On 10 parts that adds 18 dollars each; on 500 parts it adds only 36 cents each. This is why short runs need higher unit pricing. Always quote setup per batch, and never fold it into cycle-driven cost or you will misprice every other quantity break.
What scrap allowance should I add to material cost?: Add scrap based on your first-pass yield, not a flat guess. If you typically scrap 3 percent, multiply material by 1.03. For hard-to-machine alloys, tight tolerances, or unproven processes use 5 to 8 percent. Include drop and cutoff loss too: a 12-inch part from 12-foot bar with 0.5-inch facing and cutoff wastes material every piece. Track actual scrap and update the factor quarterly so it reflects reality.
Should I apply margin on cost or price (markup vs margin)?: This template applies margin on price, so a 30 percent margin means cost is 70 percent of the quote: divide cost by 0.70, not multiply by 1.30. On 100 dollars of cost, a 30 percent margin gives 142.86 dollars, while a 30 percent markup gives only 130 dollars. Confusing the two silently erodes profit. Pick margin, be consistent, and target 25 to 40 percent depending on competition and risk.
How do I quote multiple operations on one part?: Cost each operation separately with its own machine rate and cycle time, because a lathe op and a VMC op carry different burden rates. Sum the operation costs, add setup for each, then add material, labor, and overhead before margin. A part with turning at 75 dollars per hour and milling at 95 dollars per hour must not use a single blended rate, or you overprice the cheap op and underprice the expensive one.
How do I handle first article and inspection time in a quote?: Treat first article inspection and PPAP documentation as setup-type costs spread over the batch, plus per-piece inspection time in the cycle. A full FAIR per AS9102 can run 4 to 12 hours. On a 50-piece order that adds meaningful cost per part, so quote it as a separate line the customer can see. For recurring in-process checks, add the gauge time (say 30 seconds per part) to cycle time.