OT: Any one own their own machine shop here?

Gun guru · Jul 19, 2009

I am just wondering if anyone on this site has their own shop, whether at their own garage or they rent or own industrial space. Where I work I am a machinist and we send out some work due to large plates that dont fit on Bridgeport or large turnings that are too big for our lathe.

But we got back some quotes and this one shop quoted a small detail package of aluminum plates and fixture pieces. And they basically told our purchasing agent that if they could have the entire job they would take 20% off the entire quote, so they could do the work. This is in the SE Michigan area, which is in bad shape economically.

If you own your own shop what is your hourly rate for most work? What equipment do you have? How many people work there and do you lease or own space?

Just curious.

Spook · Jul 19, 2009

I have 2 friends that have shops. Both say biz is very slow. Sorry I don't know the rates. Both are 1 man operations, both used to have 10 to 12 employees. The only reason they are still working is that they have to. It was always a very competitive biz. Now it's just survival.

Bob - MI · Jul 19, 2009

I have a small machine shop that I oversee in the investment casting foundry that I am at. I do the estimating and the process design and I try to get $60.00/hr base rate plus markup for G&A/scrap/profit. It was easier to get that number a couple of years ago but today we are more often looking at $40~$45/hr total. We have a full battery of Bridgeports and engine lathes and also have 2 Haas VMC's with 4th axis drives as well as a Haas SL30 lathe.

Guy next door has a great looking shop with a VMC, CNC lathe, water jet cutting, bending and fabircation, as well as argon glove box welding for exotic alloys. His accountant is telling him he needs to get over $100.00/hr and he is now talking about giving up in 3 months because of no work. I gave him a job last week that will generate $57.00/hr on his lathe (he eats insert costs) and he's super happy to get it. He should fire his accountant and find a way to stay alive.

West Michigan is saturated with great capability that is going to waste as well.

Dave_Id · Jul 19, 2009

I had my own moldmaking business for close to 20 years, but after Nafta, and the WTO, I could no longer compete with the Chinese. At that time (around 2003), the offshore shops were quoting the finished product for the same price as my out-of-pocket expenses were. My shoprate at the time was $50/hr. How can anyone compete with Chinese govt. subsidized shops, building tooling 200 miles offshore on a ship? I auctioned everything off for about $.10 on the dollar. I worked in Austin, Texas for a few years, before coming up to Minnesota, but central Minnesota is about as depressed as Michigan. I'm heading back to Texas, hopefully Texas will secede from the Union, and get away from this socialism being pushed down our throat by these crazy people in Washington.

Gun guru · Jul 19, 2009

Yes survival is the name of the game now.

It seems that unless you are a company that has the ability to wait 2-3 months to get paid and you have CNC equipment, no overhead and no employees then you will get some work. And you have to charge $30/hour (and no more)

Gun guru · Jul 19, 2009

As far as the Chinese mold making quality, how is their quality compared to the US stuff?

Gun guru · Jul 19, 2009

I know of 3 guys that would be super happy to get $57/hour for any work. Even if they have to eat the tooling cost, inserts arent cheap though.

Dave_Id · Jul 19, 2009

By the early 2000's they were building a good product. I've been away from the moldmaking side of it since 2005. We had no problem with competition with them in the 90's. People who bought from them ultimately brought them back to US shops to fix the crap. Of course, then our shop rate jumped to make it worth our while. Because time was taken away from building molds for our good customers.

kyhayman · Jul 19, 2009

I guess location is everything. I needed a couple of simple things done, reconfigure a hydraulic cylinder oil passage and cut a keyway in a mild steel shaft. Two week backlog and 75.00 per hour. It used to be a months backlog before things tanked economically.

Anonymous-0 · Jul 19, 2009

I'm a self employed die designer. I do contract work with a few tool and die shops in N.E. Ohio, most of the shops I have dealt with are in the $45 to $50 per hour, but they are out side of the larger cities and have not upped thier rates since the late 90's. To stay competitive most of thier work goes across thier CNC's and Wire EDM's. They have one operator/programmer to 3 machines, all designs are done in solid models so programming is point and click. The ones that are left are the ones that have kept thier rates low and own thier buildings and machines with little or no debt.

Formerly PaMike · Jul 19, 2009

I work in our families machine shop. Currently owned by my dad, with me coming in as a partner. We mainly build custom machinery, but we also do general machine work. We are at $85.00/hour. We employ welders/fabricators,engineers,machinists, and assemblers/field service techs. The increasing fixed costs are what scare us. We operate dept free, with my parents owning the real estate, and thats what has allowed us to weather the tough times. I dont know how companies do it paying on millions of dollars of debt. Our health insurance went up 35% last year. We switched to a high deductible plan and now it went up 15% this year. Whens it stop?

Anonymous-0 · Jul 19, 2009

Local shop here has a flex rate. If you pay your bill when he sends it and are patient with them the rate is about $60/hr. Forget to pay the bill and argue with them the rate is still $60/hr but what ever job it is seems to take an hour or two longer than it actually did. They are setup and build a lot of drainage pumps. Done work for people all over the country, actually the world. Sent some stuff to Grand Cayman a few times. Oddly enough I have a cousin there and while attending her wedding I saw the hoppers that were at his shop sitting at a concrete plant on Grand Cayman.

Heavy D · Jul 19, 2009

I have my own shop (SW PA). My rate is $40.00/hr.I work alone in my shop, but there is five of us who work together (they each are owner operators like me). This system has worked out well for us over the last 10-12 years. But our work load is down about 60% of last year. D

tlak · Jul 19, 2009

You talk of twenty years of hard times but 6 months of theoretical socialism is the basis for all your problems?

Best I can figure from this board what socialism is, is if I have it's ok but if you get some it's bad.

Dave_Id · Jul 19, 2009

Maybe you should read my reply again...that's not what I said.

IndianaRed · Jul 19, 2009

No dippy, socialism is forcibly taking from one person the fruits of his labor and giving it to someone that has not earned it.

We all know you like that idea.

Anonymous-0 · Jul 19, 2009

Red, That has been the fate of this country ever sence the first Continental Congress raised money to support George Washingtons army.

Spook · Jul 19, 2009

I don't know about firing the accountant. If the accountant is competent, those numbers should be reliable. Payin rent, utilities, tooling expenses will add up in a hurry. Does that $100 include a depreciation allowance?

Cas · Jul 19, 2009

Back to NAFTA and WTO, were not these programs
started by conservative capitalist nnalert and
nnalert around the Ronald Reagan era? I Do not
see how this movement relates to the current
Socialist program being pushed down our throats.

bison · Jul 19, 2009

I got a fully equiped one stop repair shop on my ranch, all used machines and tools aquared over the years or build my self at home.I do all Welding, fabricating,machining and general repair/maintenance + tires mainly for myself and for some neighbors,from lawn mowers to industrial equipment,farm or vehicles.All by my lonesome.
Only thing i ever farm out is crank grinding and block boring.

Gun guru · Jul 19, 2009

Your right.

The Nafta BS and the WTO is a product of BOTH parties in the government, also known as bribes for both parties. I believe in free trade but I also believe in FAIR trade.

Allowing Mexicans to run up here and work for low wages while they suck down government benefits is dead wrong.

Allowing the Chinese to setup sweat shops and have slave labor making stuff is wrong too.

And allowing the US manufacturing base to be destroyed all in the name of "free" trade is super stupid.

Spook · Jul 19, 2009

But now, very few people work in manufacturing. We aren't important anymore. I don't see things changing - manufacturing is a dying industry here.

rodgernbama · Jul 19, 2009

Well said.

tlak · Jul 19, 2009

So when you run around without medical insurance and society is suppose to fix you, where did you chip in? And when your mother brings a bag of welfare food to you in her back yard, where did you chip in?
My point is, probably everybody on this board gets something from society, write-offs, farm welfare, VA benefits, who are you picking and choosing to receive which benefits?
And you yourself said you didn't pay any taxes because of your write-offs, what social benefits did you earn by doing this?

Anonymous-0 · Jul 19, 2009

You can get some fine molds and tooling built in China, but the price is not much less than the US price. The tightwad purchasing agents go for the lowest quote, so they get junk molds built from materials that have no tracability. Most of the blame goes to the purchasing people, they score brownie points by "saving the company money" Then, when TSHTF, they try to put blame on everyone else. I have seen instances where a shop spent a year fighting a Chinese mold, and never got any good parts..

Bob - MI · Jul 20, 2009

The $100.00/hr rate has 3 employees in it. He is down to one now and he doesn't need the extra burden. The accountant is right about the rate at full cost but he now has no employees and no revenue at all. He's got a brand new Haas SL-20 lathe that he is paying $7,000/mo on and he has no work for it.

I have a 50,000 piece order for a military part that gets threaded and the total cycle time is 68 seconds. Insert cost is $0.14 per part. I need a backup source to assure that we can keep up if we have any issues. I have a competitor running this right now at $1.90 per part and they are happy to have the work. I gave him 3,000 pcs last week to keep him going.

Anonymous-0 · Jul 20, 2009

Survival? With all that stimulus money out there, and all the banks looking to loan capital now that the taxpayers own all those bad mortgages and toxic assets? I guess all these folks forgot to turn off their TV's last fall. I thought the DTV switch would make it easier for 'em to keep those TV's turned off. And what's with this $30 an hour? I thought that INflation was what external_link was bringing, not DEflation. At least that's what I keep hearing.

Seriously, though...it's gonna get a lot worse before it gets better. Although the government [and the "state-run media"] is trying to keep it quiet, the Feds are closing and taking over more banks every Friday. So it doesn't sound to me like the TARP program is working, even though the "big-boy" banks are beginning to pay some of the money back already. [Funny how, even though these repayments are taking place, none of that money ever REALLY returns to the government...because the cost of the program never goes down in spite of the repayments.]

OT: Any one own their own machine shop here?

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