QuotedPartAnswers · Updated 2026-10-30
How do I know if my shop is charging enough?
Price one of your own parts: Drop a STEP model or PDF drawing — about 90 seconds, no account.
Your part priced in about 90 seconds, no account.
You may be undercharging if the shop is busy but cannot cover payroll, maintenance, taxes, debt and the next machine. Check five numbers: fully loaded cost, billable utilization, quoted-to-actual hours, realized margin and days to cash. Worked example: $280,000 annual cost divided by 1,400 billable hours is $200/hour break-even. Selling 1,400 hours at $210/hour creates $294,000 revenue and only $14,000 operating profit, a 4.8% margin before surprises.
See how QuotedPart connects to your workflow with its API, MCP server, autonomous quoting and shop-specific learning.
Look at the books and the sold hours together
A low bank balance can come from slow payment, a bad rate, too few sold hours or a large investment. Start with annual cost that the shop must recover: loaded wages, rent, utilities, machine payment or depreciation, tooling, software, insurance, quality, quoting and owner overhead. Divide by hours that actually earn a charge, not by the calendar hours the spindle could run.
In the example, $280,000 ÷ 1,400 = $200/hour break-even. If you sold 1,400 hours at $210/hour, revenue is $294,000 and operating profit is $14,000. If 10% of the hours were rework or unbilled setup, realized revenue falls to $264,600 and the shop loses $15,400 against the same cost.
| Measure | Value |
|---|---|
| Annual fully loaded cost | $280,000 |
| Billable hours | 1,400 |
| Break-even rate | $200/hour |
| Rate sold | $210/hour |
| Revenue at 1,400 h | $294,000 |
| Operating profit | $14,000 (4.8% margin) |
Check the quote against actual work
Review ten closed jobs. Compare setup, run, inspection, scrap, outside processing and invoice collection. If setup routinely exceeds the estimate, the price is low even when the nominal hourly rate looks high. If customers accept every quote instantly and never negotiate, check whether the scope is unusually simple or the price leaves money on the table; do not raise it blindly on a critical customer.
Separate contribution from owner pay and tax. A job can cover direct cost while the company still cannot fund maintenance. Put a replacement reserve and a realistic owner wage in the annual cost list.
Fix the right lever
If utilization is low, more selling or better fit may matter more than a rate increase. If the rate is below break-even, update the rate card or stop accepting work below the floor. If cash is trapped in net 90 invoices, negotiate terms or deposits. If one customer fills the shop at a thin margin, calculate the capacity opportunity before accepting another discount.
Make one change, date it and review the result. A 10% price increase on work that takes 20 minutes changes a $70 price to $77; it does not repair a missing $200 setup.
What to do next
Build a monthly dashboard with cost, sold hours, realized rate, margin, setup variance and days-to-cash. Talk about the numbers without blaming the estimator or operator; the goal is a rate and routing that let the shop stay healthy while delivering good work.
Illustrative shop-health assumptions
- • Fully loaded annual cost $280,000; 1,400 billable hours.
- • Sold rate $210/hour; no tax or financing adjustment in the simple example.
| Measure | Value |
|---|---|
| Break-even | $200/hour |
| Revenue at sold rate | $294,000 |
| Operating profit | $14,000 |
| Operating margin | 4.8% |
Price one of your own parts
Drop a PDF drawing or a STEP file. QuotedPart reads the print, measures the model and prices it in seconds, on default shop rates you can change.
Your STEP file or PDF drawingDrop a PDF drawing, a STEP file or both
Free. No account, no email. Priced at our default US rates until you set yours.
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