Cost estimation project

Learning Goal: I’m working on a business project and need an explanation and answer to help me learn.

You are asked to develop a cost estimate for the following project:

After starting two businesses that succeeded, and two that failed, you are ready to start number 5.From experience you know how important it is to have good cost estimates for any project.

The project is to start a printing/copy shop

  1. Have both self-serve copy and photo printing machines
  2. Have high volume black and white and color copiers.
  3. Have special printers for posters and large banners.
  4. Have 3D scanners and printers to produce maximum 12 x 12 x 12-inch parts (using PLA material, like in our 3D lab).
  5. Have storage areas, as well as counters for customer service.
  6. Have at least one van for deliveries

Assume you will move into an existing building that has the rooms you need. It will need to be modified to display your business’s name on the front, and appropriate layout and wall décor inside. You will need some parking space for customers. You will need space for storage and shelves, etc.

You will need to include labor costs, including benefits. Reasonable estimates for the number of people working at one time should be made. You will hire only full-time employees. Think about when your shop will be open.

Some tasks, such as stocking shelves and serving customers at the cash register will have a learning curve. You should include maintenance.

There are a lot of assumptions and decisions you willneed tomake. I recommend starting with a list of what you want in terms of inventory, property, equipment (don’t forget cash registers), employees, etc.

You should turn in:

  1. A sketch of the layout of your facility. This will also help you identify costs. A photo of a readable pencil and paper sketch is fine.
  2. A detailed spreadsheet showing equipment, labor, insurance, material, and other costs.
  3. Include a word or pdf file explaining where your numbers came from and what assumptions you made. (Quotes, estimates, published data, learning curve calculations, etc.)
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