Machine Shop Hourly Rate Calculator

Why "what we charge" and "what it costs" are different questions

Most shops set their hourly rate by asking around. The problem: your neighbor's rate is built on their machine payments, their rent, and their utilization — not yours. A burdened rate calculation replaces folklore with arithmetic: take everything a machine costs you in a year (depreciation, maintenance, power, the operator with real payroll burden, and the machine's share of the building), and divide by the hours it actually earns money. Not the hours the doors are open — the hours a spindle is making chips on paid work.

That last input is where most shops fool themselves. A machine that's billable 1,600 hours a year at $70 burdened cost becomes a machine that costs $112/hr if it's only billable 1,000 hours. Same iron, same building — utilization is the hidden variable in every rate debate.