Estimate and costs jobs

1. ESTIMATE AND COST JOB
CNST 367
(LMFGN 3002B)

2. SETTING UP COST FOR A JOINERY
Setting up a Lease (legal costs and bond)
Machinery purchase and/or Lease, training
Setting up the space (services, power supply and wiring, dust extraction, office, Insurance, Security)
Trucks, cars, Lease, Rego, Insurance

3. RUNNING COST
• Bills: electricity, gas phone, internet, petrol,
• Office: quoting and estimating, design and drafting software purchase and
updates
• Leases: cars, CNC flat bed router, edge bender, computers and other equipment
• Consumables: screws, nails, glue, lubricants, cleaning, finishing materials
• Equipment maintenance: plant, hand & power tools, servicing cars & trucks
• Insurance: building and content, Fire protection, Building Security

4. LABOUR COST (JOINERY STAFF)
• Admin and logistics support :
Internal: front office/reception, quoting and estimating, design and detailing, CNC
programming
External: contractors, accountant, lawyers and consultants
• Productive (on the floor, on tools):
Tradesman (Cabinet Makers, Machinists, Spray painters), trade assistants,
apprentices

5. REALL COST OF LABOUR TO A JOINERY
At $ 25 per hour (hourly rate paid to an employee):
Hours worked: 40 hours working week + 7 hours over time = 50 hours pw approx. (incl. over time
rate)
Over the period of 52 weeks (full year) an apprentice will get paid an equivalent of 2600 hours (50X
52 = 2600). 2600 hours X $ 25 per hour = $ 65000 (Annual wage)
Benefits & entitlements paid on top of the wage: Superannuation, Insurance (Workers
Compensation), Sick Leave and Annual Leave will bring the cost up to $ 75000 per Year for an
apprentice and a tradesman on an award rate.
Productive hours: An employee receives a pay each week of the year but in reality works 46 weeks
which reduces number of “productive hours” down to 2300 hours (46 weeks X 50 hours)

6. HOURLY RATE TO CHARGE ?
• (all running costs + all wages paid
to all staff + business loans (if any)
+ profit margin) divided by a total
number of “men hours”
(productive hours of staff on the
factory floor only)= HOURLY RATE
to Charge out
• All costs in $ divided by all
productive staff X 2300 hours =
Hourly Rate to Charge out

7. PROFIT MARGIN
• Profit margin is a buffer required to cover
unexpected costs and add profitability to business
and designed to support growth)