Three clocks tell different stories.
Setup time prepares the job. Running time repeats for each part. Queue time is the wait between available operations. A short machining cycle can still belong to a job with a long elapsed lead time.
Record setup and run time separately. For scheduling, also identify the needed material, tooling, approval, inspection capacity, and outside processing. The cost calculator covers setup and run time; it does not predict a delivery date.
See setup absorption at work.
At an $85 combined hourly rate, 2.5 hours of setup costs $212.50. For 25 good parts, setup contributes $8.50 per part. A 12-minute cycle adds $17.00 per part; $18.00 of material brings estimated unit cost to $43.50.
| Quantity | Setup per part | Estimated unit cost |
|---|---|---|
| 10 | $21.25 | $56.25 |
| 25 | $8.50 | $43.50 |
| 100 | $2.13 | $37.13 |
Only quantity changes in this example. Real production may add tool changes, additional setups, scrap, inspection, or handling costs. Model those separately.
Margin is not markup.
A 25% markup on $43.50 gives a selling price of $54.375 and a 20% gross margin. A 25% gross margin requires $43.50 ÷ 0.75 = $58.00. The calculator uses gross margin.
Markup = (selling price − cost) ÷ cost
Ask what makes the next operation ready.
Before committing the job, name the bottleneck, confirm resource availability, and assign ownership to the next handoff. During execution, compare planned and actual setup, cycle, rework, and waiting time. The difference tells you what to improve in the next estimate.
Try it: Change quantity from 25 to 10 in the cost calculator. Keep all other inputs fixed. The cycle is unchanged; the unit cost rises because fewer parts absorb the setup.
RCM planning example. Assumes one setup, no scrap, constant cycle time, and an hourly rate containing the costs you intend to recover. It is not a commercial quotation.