---
title: "Laser Cutting Services: In-House Manufacturing Vs. Outsourcing"
description: Is it better to send out laser cutting services to specialists and pay their prices? The question of in-house manufacturing vs. outsourcing is complicated:
---

[McHone Industries Blog](https://www.mchoneind.com/blog)

# [Laser Cutting Services: In-House Manufacturing Vs. Outsourcing](https://www.mchoneind.com/blog/laser-cutting-services-in-house-manufacturing-vs-outsourcing)

 Written by [McHone Industries, Inc.](https://www.mchoneind.com/blog/author/mchone-industries-inc) | Nov 11, 2019 5:16:00 PM

Is it better to **send out the laser-cutting portion of a job to manufacturers who specialize** in that kind of work and pay their laser cutter prices? Or does it make more cents (sorry) to **buy the machinery and keep the revenue?**

In-house manufacturing vs. outsourcing sounds like a simple enough argument. But when you perform a comprehensive cost/benefit analysis, things can get a bit fuzzy with custom laser cutting services.

## Laser Cutter Services & Cost Per Hour: More Than Meets the Eye

[How much does a laser cutter cost?](https://blog.mchoneind.com/blog/sheet-metal-laser-cutting-pay) They aren't cheap -- as you might have guessed -- ranging from around $200,000 to $500,000. And remember, that up-front investment is not the only consideration when figuring out the profits vs. the cost of running a laser cutting machine.

Other[laser cutting price considerations](https://www.thefabricator.com/article/plasmacutting/estimating-your-cutting-costs) include:

- Labor costs to operate the equipment and any other work required by the process
- Operating costs for power, consumables, tooling, repairs, and maintenance
- Expenses associated with buying the laser cutter, such as monthly payments and how much the machinery’s value will depreciate by the time you want to sell it.

## The Real Problem: Time

As with many manufacturing processes, it's important to note that these cost issues are related to time:

- Hourly wages for workers
- Hours spent repairing and maintaining equipment
- Monthly payments to have the machinery in the shop

On the other hand, the price of laser cutting steel when it’s outsourced can be clearly estimated at a per-hour rate. For example, it may cost **$16 per hour** to cut out certain metal parts.

Figuring out the cost per hour for using an in-house machine is a lot more complicated. There are several factors involved:

- For how long is the laser cutting machinery idle during a work day? Can you keep the machinery producing for 18 to 24 hours a day to achieve peak efficiency?
- How much does a kilowatt hour of electricity cost? Without electricity, there’s no laser.
- How long does it take to cut through a given thickness of steel? The thicker the material, the longer it takes for a laser to cut it. Time is money. It might be better to use[another kind of cutting technology](https://blog.mchoneind.com/blog/cost-laser-vs-waterjet-cutting) if your material’s super thick.

The point is to try to look at all variables before deciding to invest in machinery rather than outsourcing the work and avoiding those complications.

## In-House Manufacturing or Outsourcing? It All Depends

Your project's cost-effectiveness is about far more than just the laser cutter's cost per hour.

The merits of manufacturing in-house vs. outsourcing laser cutting depend on the kind of work a particular fabricator does. If the component requires a lot of **complex cutting and tight tolerances**, it might be worth it to bring the process in-house. This would allow the highest level of quality control and help remove another often-ignored cost -- fixing screw-ups. The alternative, of course, it to[find a reliable metal fabricator](https://laserfab.net/2018/05/15/benefits-outsourcing-laser-cutting/) and outsource the headache.

The cost per hour of bringing laser cutting into your manufacturing facility will vary from case to case. To find out if it’s a good move to outsource, those manufacturers who are already doing their own cutting might do well to **send out a few small projects to see how the costs and quality stack up**. For manufacturers who are considering moving cutting in-house for the first time, there’s no easy way to decide. It’s a matter of doing that dreaded cost/benefit analysis and being thorough.

We advise any manufacturer thinking about taking metal laser cutting services in-house to reduce costs to have a candid conversation with a fabricator. A full-service manufacturer should know the process and what goes into laser cutter prices. It’s the best place to start, whether you need laser tube cutting services or laser-cut sheet metal services.

 

*(Editor's note: This article was originally published in October 2018 and was recently updated.)*

[View full post](https://www.mchoneind.com/blog/laser-cutting-services-in-house-manufacturing-vs-outsourcing)

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