Shop hourly rate worksheet
Laser Cutting Cost Per Hour & Machine Hourly Rate Formula
How much should you charge per laser cutting hour?
Use this 7-step formula worksheet as a cost floor worksheet when the job needs a laser cutting cost per hour. Build a defensible shop rate from depreciation, loaded labor, electricity, assist gas, maintenance, consumables, facility allocation, and overhead, then run the Hourly Rate Calculator before pricing parts. This is the operating-cost model behind fiber laser cutting machine operating costs per hour and fiber laser operating cost per hour.
Fiber laser cutting machine cost per hour
For fiber laser cutting machine cost per hour inputs — maintenance categories, service contracts, and operating-cost fields that feed the hourly rate — use the fiber laser operating cost guide.
Fiber laser operating cost per hour guidePrimary next step
Shop rate first, laser quote second. Run the calculator when you need an executable machine hourly rate, then send that cost floor into the laser cutting quote.
Cost floor summary
Laser cutting cost per hour = machine depreciation + loaded labor + electricity + assist gas + planned maintenance + consumables + facility allocation + overhead. Use your own annual productive hours and utilization rate to define the machine cost floor, then add margin only after the internal machine hourly rate is clear.
Cost floor worksheet: build the shop rate, send it to the hourly-rate calculator, then return to the laser quote packet.
Quick quote intake
Build the cost floor before quoting
This worksheet builds the shop hourly rate input that later flows into laser quote, nesting, overhead, and export workflows.
Material
Not priced here
Thickness
Used later by quote tool
Cut length
Used later by quote tool
Shop rate
Primary output
Target margin
Apply after cost floor
Export/report
Send rate into worksheet
Quote packet status
Inputs, assumptions, and export readiness
Cost floor
readyBuilt on this page
Next quote step
reviewLaser calculator next
Evidence
reviewAccounting data required
Result preview
Result preview
- Depreciation and machine cost
- Hourly cost block
- Labor, power, gas, maintenance
- Operating block
- Facility and overhead
- Allocation block
Shop hourly rate
Cost floor output
Margin belongs after the internal machine hourly rate is visible.
Assumption checklist
- Use accounting policy, productive hours, payroll burden, utility bills, and maintenance records.
- Keep setup time visible so small runs do not hide cost inside a generic hourly rate.
- Send the finished cost floor into laser quote and overhead tools before export.
Reference data governance
Last reviewed: 2026-04-27. Hourly-rate defaults are cost-accounting assumptions for depreciation, loaded labor, power, gas, maintenance, facility, and overhead. Replace them with shop accounting data.
For maintenance and service contract categories, collect planned service, optics, nozzles, filters, emergency repair allowance, downtime records, and contract scope as inputs. Do not treat generic service prices as a quote-ready benchmark.
Review methodology and assumptionsQuick Summary
Total Hourly Shop Rate = Equipment + Labor + Energy + Maintenance + Consumables + Facility + Overhead
This guide intentionally treats example numbers as planning placeholders, not universal rates. Replace every default with your shop invoices, payroll data, utility rate, maintenance records, and actual productive machine hours before quoting.
1. Equipment Depreciation
What It Includes
- Laser cutting machine purchase price
- Installation and commissioning costs
- Initial training and setup
- Software licenses (CAD/CAM, nesting)
Calculation Formula
Inputs to Collect
Installed machine cost
Use the invoice-backed machine, installation, commissioning, training, and software cost you actually capitalized.
Useful-life policy
Match your accounting policy or internal replacement plan instead of copying a generic lifetime-hour number.
Productive machine hours
Separate calendar availability from actual cutting, setup, maintenance, and idle time.
Financing or lease treatment
Decide whether financing cost belongs in depreciation, overhead, or a separate cash-flow line.
Pro tip: Keep depreciation conservative and review it when utilization, maintenance history, financing terms, or the planned replacement date changes.
2. Direct Labor Cost
Components
- Operator base wages
- Benefit load from shop policy or payroll records
- Payroll tax and statutory burden from accounting records
- Paid time off, holidays, sick leave
- Training and skill development
Calculation Formula
Use your own labor burden multiplier so benefits, taxes, paid time, and shift premiums stay visible.
Labor Inputs to Collect
Use shop policy or payroll records for benefit load, payroll tax, paid time, and shift premiums so the rate is traceable to your accounting basis instead of a public percentage range.
Payroll-backed operator cost
Start from actual wages or salary, then add taxes, benefits, paid time, and shift premiums.
Operator allocation per machine
A single operator may cover one machine, several machines, or only part of the run depending on automation and supervision.
Programming and supervision policy
Decide whether programming, lead-operator review, and production management are direct labor, setup cost, or overhead.
Note: Highly automated shops with lights-out operations may allocate less operator time to each machine. Record the allocation policy and supporting shift data before reducing the labor component of the hourly rate.
3. Energy Cost
Power Consumption Components
- Laser source wall-power draw from the machine spec or measured logs
- Chiller/cooling system load
- Dust collection and filtration load
- CNC controller, motors, and auxiliaries
- Facility HVAC allocated to machine space
Calculation Formula
Use measured load factor when available; otherwise keep the assumption visible.
Energy Inputs to Record
- Laser source wall-power draw from the machine specification or meter log
- Chiller, extraction, controls, compressor, and other auxiliary loads
- Average load factor from measured production or a documented planning assumption
- Electricity tariff, peak premium, demand charge treatment, and review date
- Resulting electricity cost per operating hour used in the quote packet
Energy efficiency: Treat the machine specification as a starting point. Use measured wall power, auxiliary loads, load factor, and your electricity tariff before feeding the value into customer-facing quote policy.
4. Maintenance & Consumables
Regular Maintenance Items
Protective lenses
Use supplier invoice cost and your actual replacement history.
Cutting nozzles
Track nozzle usage by material, pierce count, and cut-quality requirement.
Assist gas
Calculate from your gas contract, pressure settings, nozzle size, and measured consumption.
Scheduled maintenance
Allocate preventive maintenance, alignment checks, calibration, and spare parts across productive hours.
Convert It to an Hourly Cost
5. Facility & Overhead Allocation
Overhead Categories
- Facility: Rent/mortgage, property tax, building insurance, utilities (HVAC, lighting)
- Administration: Management salaries, accounting, IT, office supplies
- Sales & Marketing: Salespeople, advertising, website, customer acquisition
- Quality & Logistics: Inspection equipment, forklifts, material handling, shipping
- Insurance: General liability, equipment insurance, workers compensation
Allocation Methods
Machine Hour Method
Floor Space Method
Percentage of Direct Labor
Overhead Review Checklist
Use the same time base
If annual overhead is divided by machine hours, use productive hours consistently across all machines.
Avoid double counting
Do not count utilities, supervision, maintenance, or financing twice across direct cost and overhead lines.
Reconcile to accounting totals
The modeled overhead pool should tie back to your actual facility and administrative cost records.
6. Cost Floor Checklist
Cost floor checklist for a fiber laser hourly-rate model:
Quote check: Treat this as an illustrative model, not a published market rate. Your customer rate should first cover internal cost, then reflect margin, payment terms, job risk, and the local competitive context.
Best Practices
1. Review Rates Quarterly
Energy costs, wages, and material prices fluctuate. Update your rate calculation every 3-6 months to maintain profitability.
2. Track Actual vs. Estimated
Monitor real consumable usage, maintenance costs, and actual productive hours. Adjust estimates based on historical data.
3. Separate Setup from Run Time
Charge setup time separately or amortize over batch quantity. Don't hide setup costs in the hourly rate.
4. Consider Utilization Rate
Fixed costs (depreciation, facility) must be recovered over actual productive hours. A machine running 60% vs 90% capacity has different cost structures.
5. Compare Price Only After Cost Coverage
Market checks are useful after you know the internal cost floor. Do not lower a quote below cost just because a competitor appears cheaper.
Hourly Rate Questions
How do you calculate laser cutting cost per hour?
Add equipment depreciation, loaded labor, electricity, assist gas, maintenance, consumables, facility allocation, and overhead, then divide fixed annual costs by productive machine hours. Add margin only after the internal cost rate is clear.
What is the difference between machine hourly rate and customer price per hour?
Machine hourly rate is the internal cost to run the equipment. Customer price per hour adds margin, risk, payment terms, setup recovery, and market positioning on top of that internal cost.
How much is laser cutting per hour?
There is no universal hourly price. The defensible answer depends on your installed machine cost, utilization, operator allocation, local labor cost, electricity rate, assist gas, maintenance history, and overhead allocation.
Should setup time be included in the hourly shop rate?
Keep setup time visible instead of hiding it inside the hourly rate. Charge it separately or amortize it over the batch quantity so small runs do not look artificially cheap.
Can I use this formula in a spreadsheet?
Yes. Use the formula on this page for the hourly-rate model, then use the CSV worksheet to carry the hourly rate into material, cycle-time, pierce-time, gas, labor, and margin calculations.
Build the hourly rate, then price the part
Start with the machine hourly rate, then carry it into material, pierce time, assist gas, labor, overhead, and margin before sending a quote.