Built for Prototype / R&D Shop owners.
Built for owners running precision and specialty shops - Prototype / R&D Shop included. Grounded in real business owners who quote tight tolerances, chase materials, and manage demanding customers.
What Prototype / R&D Shop owners ask about
Quoting jobs
Estimating hours, setup, and material without giving away the shop on the first PO.
Skilled trades hiring
Machinists, welders, business owners - where to actually find them and what to pay in your market.
Shop throughput
Bottlenecks, scheduling, and the job that is always in the way of the job that pays.
Customers and POs
Fewer, bigger customers vs. many small ones. Payment terms, deposits, and the customer stringing you along.
Cash and equipment
Financing the next machine, reading your numbers, and knowing when a job is losing money.
Owning the shop
Getting out of the day-to-day, training a foreman, and building a shop that runs without you at the bench.
How the money works in prototype / r&d shop
What actually decides your year
Every job is a first article and none of them repeat. Time-and-materials with a not-to-exceed is the only honest quote.
- What the customer is buying
- one quoted job against a machine hour
- Business model
- Quoted job shop work
- Your hard ceiling
- Machine hours, and the setup hours that never make a part.
You sell machine time and expertise, and you quote it before you know exactly what it will take. Setup time is the killer on short runs, and a shop that quotes run time without honest setup loses money on every small order. One customer at 40 percent of revenue is not a relationship, it is a risk.
Run the numbers
The shop rate you actually need
One machine, fully loaded, one year.
| Machine + tooling + maintenance | $34,000/yr |
|---|---|
| Operator (loaded) | $68,000/yr |
| Allocated overhead (space, power, software, admin) | $46,000/yr |
| Available hours | 2,000 |
| Realistic utilization | 65% |
($34,000 + $68,000 + $46,000) ÷ (2,000 × 0.65) = $148,000 ÷ 1,300 = $114/hr at break-even
Quoting $95/hour because that is what the shop down the road charges means you lose $19 for every hour that machine runs. Add your target profit on top of $114 and quote from there or do not quote.
Figures are illustrative benchmarks to show the method, not a quote or a promise. Put your own numbers in the same structure - that is the point.
Numbers to watch
The five numbers that tell you the truth
If you only track revenue, you find out about a bad quarter after it is over. These are leading indicators.
Spindle / machine utilization
65-80%
Idle iron is your most expensive asset doing nothing.
Quoted hours vs actual hours
Within 10%
The feedback loop that makes estimating better.
Quote-to-order conversion
25-40%
Low means priced wrong or quoting the wrong customers.
Scrap and rework rate
Under 2%
Rework is paid twice and delivered late.
Revenue concentration
No customer over 25%
The most common way a healthy shop dies suddenly.
Where the money leaks
Common profit leaks in prototype / r&d shop
None of these show up as a line item. They show up as a busy year with nothing left at the end of it.
01
Setup buried in run time
Short runs are all setup. Quote setup as its own line and set a minimum order value.
02
No minimum order
Small jobs eat the schedule and the estimator. Set a floor and hold it politely.
03
Free engineering and DFM advice
You are doing the customer's engineering for nothing and it makes their part cheaper to buy elsewhere.
04
Rush jobs at standard price
A rush displaces scheduled work. Price expedite explicitly - 25 to 50 percent - or stop taking them.
05
Material price locked on old quotes
Put a 30-day validity clause on every quote and mean it.
First 90 days
A plan you could start Monday
Three windows, in order. Do not skip the first one - you cannot fix a number you have never measured.
Days 1-30
Know your rate
- Build a real shop rate per machine including overhead and utilization.
- Compare quoted versus actual hours on the last ten jobs.
- Put a 30-day validity clause on every outgoing quote.
Days 31-60
Quote better
- Break setup out as its own priced line.
- Set a minimum order value and an expedite fee.
- Track quote win rate by customer and by part family.
Days 61-90
De-risk and load
- Identify your revenue concentration and start two new customer conversations.
- Track utilization per machine daily and schedule to it.
- Drop or reprice the part families that always run over.
Hiring ladder
Who to hire, and when
Hire on a trigger, not on a feeling.
Programmer / estimator
Quotes are going out late or at night
Slow quoting loses work you would have won.
Second-shift operator
Utilization above 75% on the bottleneck machine
Cheaper than a machine, and proves demand before you buy iron.
Quality / inspection
First-article or customer complaints are rising
Required for regulated customers; cheaper than a recall either way.
Shop supervisor
6+ on the floor
Scheduling and quality need one owner.
Say it out loud
Telling a customer their small job has a minimum
Repeat customer wants five parts.
"I can run five, but our minimum order is $450 because setup is the same whether it is 5 parts or 50."
"If you can take 25, your per-part price drops from $90 to $34."
"Want me to quote both so you can see the difference?"
Seasonality
Job shops follow their customers' capital cycles. Watch for the fourth-quarter budget flush and the first-quarter freeze, and keep two industries in the mix so one downturn does not take the year.
FAQ
Common questions from Prototype / R&D Shop shop owners
- Is this built for a Prototype / R&D Shop?
- Yes. It is grounded in real manufacturing and industrial business owners. Quoting, scheduling, hiring skilled trades, and managing customer POs are all in scope.
- Will it help me quote a job without giving it away?
- Yes. Estimating labor, setup, and material - plus the language for pushing back on a customer who wants the price cut in half - are common questions.
- Can it help me find and keep skilled trades?
- Yes. Where business owners actually source machinists, welders, and business owners, and what to pay to keep them, are common questions with real answers.
- How is this different from ChatGPT?
- ChatGPT invents confident answers from the generic web. This advisor only answers from a vetted library of real business owners and refuses when the library does not cover it.
Run the shop with fewer guesses.
7-day free trial. $97/month after. Cancel anytime, no refunds for partial periods.
More in Advanced Manufacturing & Fabrication