cost of welding and fabricating

[ironman7]

i am trying to find out the proper way to estimate jobs. we are going to open a small shop.have never been on the $$ side of welding and fabricating.anything will help. thanks, Barry

[gary keyes]

Your cost of the material plus markup for handling ( I go 30% ). Then you have to figure what your time is worth per hour, try to be competitive. You can only get what the local market will bear. When people start gripin about what you charge but still keep comin back you are on the right track. If you are bidding on jobs, don't under estimate your time. If you think you can do a job in 4 hours bid for 6 if its 10 get 15. I have done many "surveys" for the company I work for and the time I estimate for donig the job and the actual bid is normally half again what I originally figured.

[Rojodiablo]

It will vary greatly depending on what you are building. Fabbing a set of fence sections, you had better figure on going FAST, and trying to be competitive. If you are making art, then charge accordingly to how wild and one off it is. Only you can decide what you need to make off the project for the time invested. And as for precision fabwork, you should charge for what you can deliver.If you can machine stuff in house, your rate for that needs to be ?? 60 an hr for actual time in process. Remember, for welding there is sometimes lots of down time. And it is hard to justify charging for that. Whatever rate you charge an hour, you are best off to quote about 30-50% more time than needed. That way, you have some insulation for the times you are wrong. And as for materials, gas, tips, wire, rod, grind wheels, saw blades, gloves, acetone, wire brushes, etc.......all cost money. So from a given receipt, I will add 20-30% for consumables, or, add $25 per full day for stuff I can't do the job without that I will wear out/ break on that job.

[lotechman]

It is important to keep some sort of record of job costs as you go along. That way you can measure your accuracy at estimating.
I worked for one company that had been in operation for over fifteen years and did millions of dollars of business each year.
In the branch plant I supervised I started to keep a running record of costs using a changed time card and some standard software. At a big meeting with the owner I layed out our times. It took about four hours total to do the article. The owner basically told me I was incompetent and that the article only takes an hour to do. This man was selecting the prices to charge customers using his years of experience.
He also failed to include handling, cleaning, painting, and a host of operations in his estimate. Fortunately he was in a specialized market. If he had been doing general fabrications he would have gone down years ago.
I was told that in general fabrications handling time takes up to three quarters of the job. Unloading, stacking and loading can eat up time without you even noticing.... Meanwhile you are trying to weld ten percent faster. It can be wasted effort when attention should be aimed at organising the flow.

[Bob at WeldingMag]

There's also some relevant discussion at this thread:

http://www.weldingweb.com/showthread.php?t=4569

[ironman7]

sorry it took me a few days to get back on line,i only get on here every few days.you guys are very helpful.lotechman,what kind of software were you talking about? Bob I'm gonna check out that site too.rojo,gary good info too!

[ironman7]

Bob,that web site won't let me in.I log in then it thinks about it for a while,then wants me to do it again,and again,and again

[Bob at WeldingMag]

My bad. I put in a bad link. I've corrected it above.

[Bruce Vernyi]

Ironman --
You can look at the following websites for additional help:

http://www.weldingdesign.com/323/Glo...e/False/10760/
http://www.weldingdesign.com/323/Iss...se/10864/Issue

We ran these stories several years ago. Maybe it's time we re-do them.

[MicroZone]

Good information!

[lotechman]

Originally Posted by ironman7

.lotechman,what kind of software were you talking about?

I had a very talented clerk who started out on the end of a nine inch angle grinder... until I discovered his abilities. He set up a template on Excel to keep track of jobs and the progress because we were constantly getting queries about job status from the head office.
From that he set up using the Access program which is part of Microsoft Office software. We had around 25 employees and we coded the type of job by task. Making the article took about ten steps so we had ten operations. For example grinding and cleaning would for example be operation 7. The employee would put down the work order number, operation number and hours spent to the nearest quarter hour.
Every morning we would enter the job numbers, times and operations and the software would keep a running tally. We could at any time produce a time per article for a particular job or the average over the month.
From talking to my son-in-law a lot of fancy software products that are "custom produced " for a special client are simply Microsoft running in the background and custom displays that look like some software writer has been up all night for the last year. I once stood behind a guy troubleshooting a production program for a fabrication business. When I made the comment " Hey that just Basic" The screen was suddenly blanked. There is a lot of hocus pocus in the software racket.

[WillieB]

I am an accountant by trade and, I can assure you, each of my clients started his or her business with the same concerns you have. Some of them made it and some didn't. Regardless of the trade or profession, to run a successful business you have to learn to make a profit and, just as in learning to weld, the only way to do it is by doing it. Expect to lose money at first but think of it as tuition. You didn't run perfect beads the first time you fired up a torch so don't expect to make a profit the first day you open the doors.

I've seen many businesses fail and the primary reason was insufficient start-up funds to carry them through that learning curve.