The Cost Factors for Steel Fabrication


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Updated 29/08/2023

If you’re considering a custom metal fabrication job for your facility, the total cost of the project is a huge factor. There are several variables that can have a significant impact on the costs of any custom metal fabrication project. Knowing these in advance can help you be prepared for budgeting the job more easily.

When you’re getting started on a metal fabrication project, it’s important to have all preparations correct from the beginning. That means having a detailed estimate of the construction cost, which is the most important part of the job.

In the following sections, we’ll take a look at the main factors that can have an effect on the cost of steel fabrication, including materials, labour, and more.


1. Materials

It’s necessary to have an understanding of the types of raw materials needed for your project. This is a basic essential for determining custom metal fabrication costs. The raw materials used may include:

  • Aluminium
  • Stainless steel
  • Various alloys
  • Carbon steel
  • And more

In addition, the thickness of the metal also has some bearing on the material costs and the labour to fabricate it. There may be multiple materials that will work for the project, so it’s important to collaborate closely with the metal fabricator to explore whether there are cost-effective material choices other than those you’ve requested.

The costs of raw materials can be volatile due to disrupted supply chains. Your fabricator will have their own insights into the markets and what to expect.

In addition to raw materials, it’s necessary to consider the hardware or accessories that may need to be configured into the design. You may be able to supply some accessories, or you can specify the fabricator to obtain them. These parts may include latches, hinges, hydraulic components, and more. These must also be factored into the costs.

And remember that the quantity of materials and finished pieces also have a bearing on the price. The average cost per item usually goes down as quantities increase. Larger quantities may also result in reduced machine setup times and associated labour.


2. Labour Costs

Custom metal fabrication requires highly skilled labour, both on and off the shop floor. It may involve design or structural engineers who are proficient in CAD/CAM software, professional estimators, inspectors, certified welders, and assembly technicians. No matter what, labour costs are a major part of any steel fabrication project. The more agile and streamlined the fabrictor’s processes are, the more efficient they’ll be, which may result in some cost savings.

In addition to human labour, you’ll also need to count on mechanical labour. Specialised equipment and tooling are major expenses. Steel fabricators may put a portion of these costs into your project, too. Machine time for some materials simply takes longer and needs to be factored into the estimate.


3. Project Complexity

Next, project complexity can have a significant bearing on how much a steel fabrication project costs. While metal sheeting and welding can be done in many different ways, the fewer cuts, bends, and welds, the less expensive this part of the project will be. Any required specialty machining or prototypes also need to be included in the price. If dealing with very tight tolerances is needed, or these are intricate designs, the longer the job will take and can increase the cost of the project.

The greater the complexity, the higher the cost. What looks like it will work on paper, too, may have significantly different results when the project is on the production floor. That’s why reviewing plans with a design for manufacturability (DfM) approach is crucial to ensuring a plan can be produced to specifications and be structurally sound when completed.


4. Certifications & Compliance Requirements

Certain projects may have to meet strict compliance considerations, many of which require inspections, testing, and auditing. Steel certifications, traceability of materials, inspections, weld mapping, and more may be necessary.

Third-party inspectors may visit the steel fabrication shop for inspections and tests to ensure compliance with specifications. The requirement of qualified, approved welding procedures may also extend the length of the project.

In addition, the additional steps and certifications can add to the cost of the project. However, you can have peace of mind knowing that the steel fabricator can fulfil these requirements.


5. Painting & Finishing

Fabrication projects may require painting or finishing. There’s a wide range of finishes and specifications, such as chemifilm, zinc, and others, along with different types of paint and powder coatings. Each one comes with different costs. It’s also necessary to consider the design when applying a finish. Coating processes may also require certification, which can also increase costs.

In addition, it’s essential to specify the types of finishes required. The fabricator needs to know the specific product numbers and details, such as the type of coating and whether it needs pretreatment, whether there are approved suppliers, and more.


6. Delivery Methods

Shipping costs can also cause some last-minute issues with expenses if they’re not calculated in the initial quote or budget. The distance that parts need to travel is an obvious consideration of the cost of steel fabrication. Some businesses have dedicated trucking companies that will pick up products. However, others specify FOB freight, placing the liability and cost of shipping onto the fabricator. And you can count on these costs being passed onto you.

Some large, complex fabrication jobs need custom-designed packaging that needs to be built and engineered to properly secure and protect the steel during transit. In some cases, specialised shipping materials can be returned to the fabricator to reuse, which reduces packaging costs.


Summing It Up

When you’re working on a large steel fabrication project, it’s not fun to end up with surprises on your invoice or getting a call from your fabricator about unexpected costs or design issues. Accurately determining the costs of the project requires detailed drawings and specifications on a request for quote (RFQ) before the project begins.

We hope this article helps you to find ways to reduce costs safely and effectively on your next steel fabrication project.

Frequently Asked Questions (FAQs)

Q: How can I reduce steel fabrication costs without compromising quality?

A: One effective strategy is to collaborate closely with the design team to simplify intricate designs. Additionally, exploring bulk purchasing options and optimizing the production timeline can lead to cost savings.

Q: What role does technology play in controlling fabrication expenses?

A: Technology, such as Computer-Aided Design (CAD) software and precision machinery, enhances efficiency and accuracy. This can reduce material wastage and minimize the need for costly rework.

Q: Are there specific industries where steel fabrication costs are notably higher?

A: Yes, industries that require specialized steel alloys, intricate designs, or compliance with strict regulations might experience higher fabrication costs.

Q: How can I stay updated on fluctuating steel prices?

A: Regularly monitoring industry news, market reports, and working closely with suppliers can help you stay informed about steel price fluctuations.

Q: What are some eco-friendly practices that can also lower fabrication expenses?

A: Incorporating sustainable practices, such as recycling scrap steel and optimizing energy consumption, not only aligns with environmental goals but can also result in long-term cost savings.

Q: Can outsourcing fabrication to regions with lower labor costs be beneficial?

A: Outsourcing can lead to initial cost savings, but it’s important to consider factors like communication challenges, quality control, and transportation expenses before making a decision.


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