The basic formula
When a shop owner on r/Machinists asked how to speed up quoting in 2026, one of the most upvoted answers was simple: build a spreadsheet with the setup time for each operation, the approximate run time, outside services, material cost, and a percentage for scrap, then multiply by a shop rate. That's the backbone of almost every quoting method:
Each piece is worth a closer look.
1. Material
Price the stock you'll actually buy, not the finished part's volume: the bar or plate size including saw kerf, facing stock and workholding grip. Add freight if your supplier charges it on small orders. For anything exotic (titanium, Inconel), get a fresh price; don't use last year's number.
2. Setup
Count each setup separately: fixturing, indicating, touching off tools, first-article checks. Setup is the line that kills you on small quantities, because it's spread over so few parts. If you're quoting 5 pieces, setup is probably most of the price.
3. Run time
This is the hard one. There are three common ways to estimate it:
- From experience. "That's about like the bracket we did for X." Fast, but it drifts.
- From a CAM simulation. Rough the part in CAM and read the cycle time. Accurate, but slow for every RFQ. In the same 2026 r/Machinists thread, one user said Toolpath's AI estimate landed within about 20% of the finished time once he machined the part his way.
- From history. Find the most similar job you've already run and use its real time. Commenters in that thread and others called this the most reliable approach, and it's what Liquid Quote automates by matching new RFQs against your past quotes.
4. Outside processes
Anodize, heat treat, plating, grinding, certs. Get vendor prices and minimum lot charges, and add the days to your lead time. Mark these up; you're carrying the risk and the coordination.
5. Scrap, tooling and margin
Add a scrap percentage that reflects the job's risk (tight tolerances, thin walls, a new material) and any special tooling you'll buy just for this job. Then add margin. Your shop rate should already cover overhead; margin is profit on top.
A worked example (made-up numbers)
Here's how the math flows, with illustrative numbers only:
| Line | Calculation | Amount |
|---|---|---|
| Material | 20 blanks × $6 | $120 |
| Setup | 2 setups × 0.75 hr × $95/hr | $142.50 |
| Run time | 20 parts × 12 min = 4 hr × $95/hr | $380 |
| Anodize | Vendor lot charge | $150 |
| Scrap allowance | 5% of the above | $39.63 |
| Subtotal | $832.13 | |
| Margin | 15% | $124.82 |
| Quote | About $47.85 each | $956.95 |
These figures are invented to show the arithmetic. Use your own rates.
Know your real shop rate
Your hourly rate should come from your actual costs: rent, payroll, machine payments, power, software, insurance, divided by the hours you really bill, not the hours the doors are open. Many owners find their break-even rate is different from the number they've been using for years. If you've never done this math, it's the highest-value hour you can spend on quoting.
Close the loop: compare quotes to reality
A quote is a guess. The only way to get better is to compare it with what happened. If your machines report cycle times, monitoring tools can show actual run time per job next to what you quoted; Datanomix, for example, focuses on cycle time and job costing for small CNC shops (see our Neo Industries case study). Even without software, writing actual hours on the traveler and reviewing ten jobs a month will sharpen your numbers fast.
Where software helps
- Formula-based quoting tools turn your spreadsheet into a repeatable system. QuotedPart shows the formula behind every operation's minutes, so you can see and fix its assumptions.
- Inbox tools save the time spent opening, renaming and logging RFQs.
- History matching pulls up similar past jobs automatically.
Our AI quoting software guide compares nine of these tools. Start with your own method, though: software speeds up a good quoting process, but it won't fix a shop rate that's wrong.
Frequently asked questions
How do machine shops calculate a quote?
Most add material, setup time, run time multiplied by quantity, outside processes, tooling and a scrap allowance, all at the shop's hourly rate, then add margin. The details vary, but that structure is common across shops.
How do I estimate CNC cycle time quickly?
Three common ways: compare to a similar job you've already run, rough the part in CAM and read the simulated time, or use an AI estimator. Historical comparison is often the most reliable if you've tracked actual times.
Should I use a spreadsheet or quoting software?
A well-built spreadsheet works for many small shops. Quoting software starts to pay off when you're quoting many jobs a week, losing work because quotes are slow, or need several people to quote consistently.
How do I know if my shop rate is right?
Divide your real annual costs (payroll, rent, equipment, utilities, insurance, software) by the hours you actually bill. If that number is close to what you charge, your margin is thinner than you think.
Sources
- r/Machinists: How's your experience with automated quoting tools? (Aug 2026)
- QuotedPart: how the formulas work
- Datanomix Machine Track
Facts come from public vendor pages and the sources above, checked October 24, 2026. Prices change; confirm with the vendor. Forum comments are individual opinions. Spot an error? Tell us.