What a Quote's Estimated Cost Does Not Include in EDGEBIC

A quote's estimated cost in EDGEBIC is labor plus material, and nothing else. In EDGEBIC by User Solutions, labor is the allocated work hours from the simulated schedule multiplied by each work center's rate, material comes from the routing's material steps or the product's unit cost, and there is no third line. That boundary is deliberate, but it only stays safe if you know where it falls, because everything outside it still has to be recovered somewhere.

Two lines, on purpose

The cost model has exactly two components. Labor and material. Both are traceable: every labor hour on the cost sheet is an hour the engine placed on a specific machine in a specific shift, and material comes from steps you modeled or from a unit cost you entered. The full arithmetic is in pricing a quote from the schedule.

The narrowness is the point. A cost figure you can follow back to a machine and an hour is a figure you can argue about productively when the job runs hot. The moment a quoted cost carries allocated shop expense, an argument about a late job becomes an argument about allocation method, and nobody learns anything about the shop.

The trade is that the number is smaller than your true cost of doing the job, and your pricing has to know that.

What sits outside the boundary

The last group is the interesting one, because those costs are real, job-specific, and genuinely unknowable to a scheduling engine. No routing can tell you that this alloy eats inserts.

The sanctioned escape hatch

For job-specific extras, the manual cost override exists precisely so you do not have to lie about the price. Simulate first so labor and material roll up honestly, then enter your all-in cost basis as the override. Profit and margin recompute from your number while the calculated split stays on the record.

That last detail is what makes the override better than the alternative. When the job finishes and someone compares quoted hours against actual hours, the original labor and material arithmetic is still there to compare against, and your adjustment is visible as an adjustment rather than hidden inside a price. Mechanics and worked cases are in using the manual cost override, and the comparison it protects is in quote versus actual hours.

The habit that follows: never bump a unit price to cover a cost. Bump the cost basis, then let markup derive the price. See setting markup and unit price.

The accidental exclusions, which are the dangerous ones

Everything above is a designed boundary. Two other exclusions are accidents of setup, and they are far more likely to lose you money:

• A work center with no rate prices its step at nothing. The hours are real, the machine is busy, and the cost line is blank. This is the most common reason a quoted margin looks too good, and it is covered in a quote cost came back at zero.
• Relying on the material fallback prices only the end product's own unit cost. For a product built from several purchased components, the fallback misses most of the material content. Model material as material-type steps in the routing instead.

Neither of these is the cost model being narrow. Both are the cost model being fed nothing and reporting nothing, which is exactly what it should do rather than inventing a figure.

What this means for your margin floor

Here is the practical consequence, and it is the part most often missed.

A quoted margin compares price against labor plus material. It has not absorbed a single dollar of shop expense. So a quote showing a healthy margin is not showing a healthy contribution to the business, it is showing that the price covers the machine hours and the metal with room to spare. How much room you need is a business question the software cannot answer.

Which means the floor you enforce on quotes has to be set with the gap in mind. Work out roughly what share of revenue your shop expense consumes, add the profit you actually want, and treat that total as the minimum acceptable quoted margin. Do that once and the color coding on the quote grid stops being decoration and becomes a rule. The mechanics of the margin figure and its colors are in reading quote margin and profit.

A worked example

A 50-piece casting simulates at 180 work hours. Labor comes to the sum of those hours against each work center's rate, material comes from the routing's material step, and the estimated cost is those two lines added together. Nothing else is in it.

The estimator knows two things the routing does not: this alloy is hard on tooling, and the historical scrap rate on this part means running a few extra. Both are real money. Rather than nudging the unit price up and leaving no trace, the estimator sets a manual cost override at the simulated cost plus the tooling and scrap allowance. Margin now computes from that basis, the labor and material split is still stored, and the reason is recorded rather than remembered.

The shop's own floor, set to absorb shop expense that the two-line model never sees, is what decides whether the resulting margin is acceptable. The quote's job was to be accurate about hours and material. The floor's job is everything else.

The takeaway

A quoted cost in EDGEBIC is labor plus material, with no overhead line, no burden, and no standard cost layer, because a two-line figure traceable to real machine hours is worth more to a shop than a loaded number nobody can unpick. Job-specific extras belong in the manual cost override, which preserves the calculated split for later comparison, and recovery of general shop expense belongs in your markup and your margin floor. The exclusions worth fixing are the accidental ones: a missing work-center rate and an unmodeled material step. Work the full flow in the EDGEBIC quoting guide, see the cost arithmetic in pricing a quote from the schedule, see the platform on the EDGEBIC overview, and if you are moving off Resource Manager DB, start with the RMDB to EDGEBIC path.