How to Avoid Underquoting CNC Parts

One of the most common pitfalls in precision machining is underquoting — offering a price that’s too low to cover actual production costs. This can lead to losses, strained client relationships, and long-term damage to your business.

Here’s how to quote CNC parts accurately and avoid underestimating your costs.

1. Understand the Real Machining Time

Too many shops underestimate actual machine time. Use CAM software estimates only as a starting point, then adjust based on:

• Tool changes
• Workpiece setups
• Fixturing and clamping
• Operator attendance time
• Machine warm-up or probing cycles

Tip: If your shop rate is $60/hour and actual time per part is 8 minutes, that’s $8 per part in machining alone — not counting any setup or programming cost.

2. Don’t Ignore Setup and Programming Time

Setup and programming can take hours, especially for complex jobs or first articles.

For small batches, setup time can exceed actual machining time.

Always divide setup time across the number of parts. Example:

• 2 hours setup for 10 parts = $12 extra per part if your shop rate is $60/hr.

Neglecting this turns a “profitable” order into a net loss.

3. Account for Tool Wear and Tooling Cost

Cutting tools wear out. Some materials — like stainless steel or Inconel — chew through tools fast.

Include tool cost in your quote, especially for long runs, tough materials, or tiny tools (e.g. end mills under Ø1 mm).

If a cutter costs $20 and lasts 50 parts, that’s $0.40 per part — add it.

4. Include Inspection and Documentation Time

Many precision parts require:

• First Article Inspection (FAI)
• In-process measurements
• Final inspection
• Certificates or reports

These tasks take time and must be billed. Don’t assume inspection is “free overhead” — it’s labor like anything else.

5. Don’t Underestimate Material Costs

If you’re buying material, consider:

• Raw stock price
• Minimum order quantities (MOQ)
• Cutting waste or yield
• Material certification cost

For example, ordering Ø60 mm 304 stainless round bar for 5 parts might require buying a full meter — not just what’s used.

6. Consider Scrap and Risk

Scrap happens — broken tools, tolerance issues, or surface defects. Build in a scrap factor (commonly 1-5%) into your quote.

Also factor in rework risk if tolerances are tight or drawings are unclear.

7. Watch for Hidden Operations

Don’t forget:

• Deburring
• Tapping
• Part marking
• Surface finishing (anodizing, passivation)
• Packaging and labeling

Each takes time and/or outside cost. Itemize them in your quote.

8. Communicate Design Impact

Let the customer know when design features drive cost:

• Tight tolerances
• Unnecessary flatness/roundness specs
• Deep holes
• Small radii in internal corners

Propose modifications to make parts more machinable — and get higher win rates with better margins.

9. Use Quoting Software or Spreadsheets

Even basic spreadsheets help standardize your quoting. Better yet, use quoting tools like:

• Xometry’s instant quote engine (for benchmarking)
• Paperless Parts
• Fictiv or Jiga
• Or build your own Excel templates with pre-set hourly rates, tooling assumptions, and markups.

Conclusion

Underquoting CNC jobs is easy — and dangerous. Accurate quoting requires:

• Deep understanding of your machine time
• Honesty about setup, tooling, and inspection
• Transparent communication with customers

Precision quoting is a skill — and one of the most profitable to master.