Excel can be a useful starting point for preparing laser cutting quotations. It is familiar, flexible and easy to customise. For a small workshop producing occasional quotes, a well designed spreadsheet may work adequately.
Problems usually appear when quotation volumes increase, several people prepare estimates, or jobs involve different materials, thicknesses and additional processes.
The spreadsheet may calculate correctly, but the result will only be accurate if every required cost is entered. Before sending your next laser cutting quote, check whether your Excel sheet includes these 10 costs.
1. Current Material Cost
Material prices can change regularly. If your spreadsheet contains prices entered several months ago, the quotation may already be inaccurate.
Record the material grade, thickness, sheet size and current supplier price. Special materials, protective film, minimum purchase quantities and freight from the supplier may also affect the actual cost.
Material prices should be reviewed regularly, particularly before quoting large quantities.
2. Sheet Utilisation and Scrap
The material cost cannot always be calculated from the rectangular size of one part.
Part shape, quantity, spacing, sheet edges and grain direction affect how many components can fit on a sheet. Poor sheet utilisation produces more scrap and increases the cost of each part.
For example, a small bracket may appear inexpensive when calculated by area. However, its shape may leave unusable gaps when nested with other parts. Your quotation should allow for realistic material utilisation rather than assuming the entire sheet will be used.
3. Cutting Length
Two parts with the same outside dimensions can have very different cutting times.
A simple rectangular plate may have only one outside profile. Another plate of the same size may contain slots, holes and detailed internal profiles. This increases the total cutting length.
Manually measuring every line in a DXF drawing can take time and may introduce mistakes. If the cutting length is estimated instead of measured, complex parts can easily be underquoted.
4. Number of Pierces
Every closed internal profile normally requires the laser to pierce the material before cutting.
A part with 30 small holes requires more processing than a similar part with two holes. Piercing time becomes particularly important when cutting thicker material.
Your spreadsheet should consider the number of pierces and the piercing time for the selected material and thickness.
5. Rapid Movement Time
The laser does not cut continuously. It must travel between separate profiles and between parts.
This movement may seem small for one component, but it becomes significant when producing a large batch containing many holes or separate cutting paths.
If your spreadsheet calculates only cutting length divided by cutting speed, it may overlook the time required for these movements.
6. Programming and Setup
Even a small order requires preparation.
Someone must check the customer’s drawing, repair open contours, create the program, select the correct material and prepare the machine. There may also be time required to load the sheet, change cutting parameters and inspect the first part.
These activities should be included as programming, setup or minimum order costs. Otherwise, small jobs can consume valuable time without recovering the expense.
7. Machine Operating Cost
The machine rate should cover more than electricity.
It may need to include finance or depreciation, servicing, cutting gas, replacement lenses, nozzles, maintenance, software, insurance and workshop overheads.
Calculate a realistic hourly machine rate and review it periodically. Using an old or guessed rate can make a quotation appear profitable when the machine is operating below its true cost.
8. Labour and Additional Processes
Laser cutting may be only one stage of the job.
Check whether the customer also requires:
- Deburring
- Bending
- Tapping
- Countersinking
- Welding
- Powder coating
- Painting
- Inspection
- Part identification
Each operation requires labour, equipment and sometimes outside services. Make sure these processes are separately included instead of being absorbed into the laser cutting price.
9. Packing and Delivery
Finished parts may require protective wrapping, pallets, boxes or special handling.
Heavy or large components can also require a forklift, courier or dedicated delivery vehicle. These costs can reduce the profit from a job if they are not included in the quotation.
Clearly state whether packing and delivery are included or charged separately.
10. Overheads and Profit Margin
A quotation should contribute towards the cost of operating the complete business.
Administration, rent, insurance, software, sales, accounting and nonproductive workshop time still need to be paid. After these costs are covered, the job must provide a reasonable profit.
Remember that markup and profit margin are not the same calculation. Make sure your spreadsheet uses the method intended by your business.
When Does Excel Become Difficult to Manage?
Excel may still be suitable when quotation volumes are low and one experienced person manages the process.
It may be time to review your system when:
- Quotes take too long to prepare
- Different estimators produce different prices
- Material information is stored in several files
- Drawing revisions are difficult to track
- Additional costs are regularly forgotten
- Only one employee understands the spreadsheet
- You cannot easily review previous quotes
These problems do not necessarily mean the Excel formulas are wrong. They often mean the quoting process has become too complex for a manually managed spreadsheet.
A More Consistent Quoting Process
Smart Cut Quote is designed specifically for laser cutting and fabrication quotations. It can import DXF, DWG and supported 3D STEP files, calculate cutting length, piercing and rapid movements, and apply your own material prices, machine rates and process costs.
Costs for bending, welding, painting, powder coating, deburring, packing and delivery can also be added using your business settings.
The purpose is not to replace the estimator’s knowledge. It is to record that knowledge in a consistent system so quotations do not depend entirely on manual calculations or one experienced employee.
Before replacing your spreadsheet, examine the 10 costs above. If several are missing or difficult to maintain, your current quoting method may be costing more than you realise.
For more information about Smart cut Quote Software and product inquiries, please contact us at https://nctools.com.au/ or call us on +61 3 8618 6884
Or Visit https://smartcutquote.com/
