Industry TemplatesFree worksheetPDF, Excel, Word exportIndustrial Machinery

Engineer to Order Machine Quote Worksheet

An engineer to order quote is a cost estimate for a machine that does not exist yet. This worksheet lets you build it up line by line, add a risk allowance where the design or supply chain is uncertain, and see the price at the margin you target.

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Base cost	Risk cost	Line total
$39,900	$5,985	$45,885
$27,200	$1,360	$28,560
$24,500	$1,960	$26,460
$22,320	$2,232	$24,552
$31,800	$1,908	$33,708
$27,300	$5,460	$32,760
$6,800	$680	$7,480
$9,200	$920	$10,120

Base cost

$189,020

Risk allowance

$20,505

Total cost with risk

$209,525

Risk as percent of base cost

10.8%

Quote price at 25% gross margin

$279,367

Quote price at 30% gross margin

$299,321

Quote price at 35% gross margin

$322,346

Margin is applied as a share of price (price = cost / (1 - margin)), not as a markup on cost. A 25 percent margin needs a 33 percent markup. Replace the example rows with your own and add a row per sub-assembly if you need more detail.

Compare quoted and actual project cost

Optional review of how to pull job actuals from your ERP and compare them to the quote lines in this worksheet.

Optional. The tool and every export work without this. No spam.

How to use the worksheet

Start with the scope you can defend from the customer specification: engineering hours, purchased components, fabrication, assembly, controls, software, factory test, installation and freight. Enter quantity (or hours) and a unit cost or labor rate for each line. The base cost computes itself. Then set a risk allowance on every line that carries uncertainty instead of hiding one big contingency at the bottom. Add or delete rows freely, and export the sheet to Excel to attach to your internal approval.

Use fully loaded labor rates, not wage rates.
Quote engineering hours from a task list, not a percentage of hardware.
Keep freight and rigging as their own line; they are often missed.
Include FAT witness time and travel if the contract requires customer witnessing.

Why risk goes on each line

A single contingency percentage hides where the danger actually is. Software that depends on an unproven vision inspection is not the same risk as a catalog servo axis. Putting risk on each line makes the estimate auditable: a reviewer can challenge the 20 percent on programming without arguing about the whole machine. The summary shows total risk as a share of base cost. For first-of-a-kind machines a share of 8 to 15 percent is common; for repeat designs with small changes it should be lower. If your share is near zero, the estimate is probably optimistic.

Reading the price outputs

The three price lines divide total cost by one minus the margin, which is how gross margin is defined. Compare them against the market and against your win history. If the customer budget only supports the 20 percent case, the useful conversation is about scope, not discounting: remove options, shift FAT to the customer site, or cut spares. Remember that gross margin must still cover warranty, sales commission, bank guarantees and cost of money on milestone payments, none of which are in this sheet unless you add them as lines.

Common mistakes

The most frequent errors in ETO quoting are pricing from a similar past machine without re-checking component prices, forgetting integration and debug hours for controls, leaving out documentation and translations, and ignoring currency exposure on imported components. Another is quoting with lead-time-driven expediting costs missing. Treat the first quote as a hypothesis: once the order is won, the same lines become the project budget and should be loaded into your ERP project or job cost structure so actuals can be compared line by line.

Frequently Asked Questions

What is the difference between margin and markup?

Markup is a percentage added to cost; margin is the percentage of the selling price that is profit. A 30 percent markup gives a price of 1.30 times cost and a 23 percent margin. To reach a 30 percent margin you divide cost by 0.70, which is what this worksheet does.

How much risk allowance should I add?

It depends on novelty. Catalog components with firm quotes may need 2 to 5 percent. New mechanical designs and software integration with unproven technology often carry 15 to 25 percent. Base the figure on your own history of overruns by category, not on a rule of thumb alone.

Can I use this for repeat machines?

Yes. For repeat designs, start from the last as-built cost, update component prices, reduce the risk allowances where the design is proven, and add only the engineering hours for the changes. Keep the structure identical so quotes remain comparable.

Does the sheet handle multiple currencies?

No, it assumes one currency. Convert imported component prices at a rate that includes a hedging or volatility buffer, or add a separate contingency line for currency exposure. You can change the currency symbol by editing the cost labels when you export to Excel.

If your quotes live in spreadsheets while actual cost lives in the ERP, Netray can help compare quoted and actual cost by project automatically, on your own infrastructure.

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