Film-Tech Forum ARCHIVE: Need Some Help Starting My Own Business

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Posted by Joshua Waaland (Member # 287) on 06-02-2008, 07:17 PM:

My current work situation has become less than favorable and there is no room for growth so I need to find something else. I have been with this company for almost nine years now. The problem is I make too much to find another job without a finished degree (completed two years of my BSME) that pays the same money. Of course it would be nice to make more money so my wife could stay home with our new baby.

Since I have been at this company I have been exposed to a multitude of different things. I have worked with major corporations and small mom and pop companies. I have lots of experience working in and around machine shops and the last few years I have been in many unique fabricating shops. I know how to weld, do basic machining and I am very mechanically inclined.

I have always wanted to own my own company because I know it would be rewarding and I know I am capable of doing it. I work hard, I don't cut corners and I am soft spoken (I know it's hard to believe by my posts on here) so I sometimes get taken advantage of. I am smart enough to see that the money and reward is in owning the business where you only answer to yourself. I realize that it takes lots of hard work and hours but I do that already so why not reap the fruits of my labor?

The big problem is finding something that I can manufacture in my garage and possibly grow into a business. I would love to make high quality film equipment (like rewind tables), but this industry doesn't seem to have much of a future in it. I knew one guy who bought a machine and makes the hitch pins for Reese and other big companies in his barn.

Anyone have any ideas of something I could make? I am willing to buy a welder, mill, lathe, whatever it takes to get started but I have been stumped by what I should try my hand at. There is a lack of places around here to buy good old fashioned, standard, wooden picnic tables. Last year while I was looking for one to buy I considered buying enough wood to make two and selling one to see how it goes. My heart is more in metalworking though so I would love to work in my garage making something I enjoy and making money at it. I just have to find a niche. Any ideas? [Confused]

Posted by Mike Blakesley (Member # 26) on 06-02-2008, 09:17 PM:

My mom gave me a magazine clipping once that had a lot of wisdom in it. Basically, it said: Create a business plan that pencils out and shows a good profit. Then, if your business can still make it on half of your projected sales, you "might" have a successful business.

Posted by Mark Gulbrandsen (Member # 72) on 06-02-2008, 09:35 PM:

And you just had a baby... er I men your wife had a baby... I hope your wife is working and has good health insurance for you all! In this day and age that is much more paramount than being happy at work... even more so in your case. If wife has good health insurance then go for doing something on your own and take advantage of the situation. Making picnic tables from alumnium billett is probably not a good idea that would hold you through the winter though.... If you persue something in the entertainment industry remember that no matter what you do it'll be a rollercoaster ride... lots of income on one month... not much the next. It all balances out a the end of the year however when you get to send all your profit to Uncle Sam...

On another note I know a guy that repairs fuel tanks for "Big Rigs". He is one of a very few in this country that do this and he built his own machinery to be able to repair them... continous welding machines, machinery to make the new end bells, etc. Apparently replacement fuel tanks cost a fortune in themselves. This is a small niche market and he makes a fortune at it.. owns three airplanes and a big farm in south central Wisconsin. This guy's full time job is as a Physist at Yerkes Observatory!!!

Mark

Posted by Joshua Waaland (Member # 287) on 06-02-2008, 09:43 PM:

Thanks. My wife works for Progressive Insurance which is headquartered here in Cleveland. They have good health insurance and she makes a lot more than I do. I'm tempted to be a stay at home dad but would really like to work for myself.

That guy in Wisconsin is doing the type of stuff I would like to do. I don't need or really want to be rich as that comes with it's own set of problems. I just want to have enough money for vacations every year, to not have to live paycheck to paycheck and to be able to send my kids to college.

Posted by Adam Fraser (Member # 1074) on 06-02-2008, 09:51 PM:

Are you a skilled woodworker? You may want to try to make log beds if you have a "northern" theme in your area like there is in Northern Michigan. We sell hundreds of log beds a year, and while our mark up is relatively small, our builders make a healthy profit. You will need a draw knife ($100), tennon machine ($1000), assorted sanders ($300), HVLP finishing system ($500) and a few other things. If you have any questions send me an email, I am a bit hesitant to give prices on a public forum..

I build log lamps for our store on free time.

Wood= Free
Cheap draw knife= $50
Lamp kit= $10.00
Finish= $2.00/lamp
Long drill bit= $25.00
1 hour of labor to remove the bark, sand them, finish them and drill a hole down the middle of the log.
I retail them at $77.00 for a table lamp and $168-$198 for a floor lamp.

I also run a motorcycle repair shop out of my house and charge $40/hour with only $1500 in tools and a license. Maybe you could do something similar with custom TIG welding and a small machine shop. Especially if you live in a relatively rural area with people that need such services (farmers, dirt bike riders, car racers.)

BTW, are you capable of making something similar to this? It is a car intercooler core that could retail for $500+ each and have 100+ orders per year. 2 piece design with a heat exchanger sandwiched in the middle.

Posted by Will Kutler (Member # 770) on 06-02-2008, 11:13 PM:

Hi Adam and Josh

Starting a machine shop in your garage is A TON OF WORK!!!
You will need to not only purchase tools, but you need to make something that is unique that your customers will depend on you...and only you...for! Too many times a client will ask a small job-shop to build a prototype...and the job-shop will cut a break in order to secure the production run...where the $$ is. Then the the client will go down the street to a copetitor shop that undercut you by a few pennies...after all, a few pennies per part will quickly add up to major $$ in a production order.

Any machine shop today will charge $60.00/hr (CNC run time) which is almost the bare minimum to cover overhead!...So, you need to be excellent at CNC programming/set-up and FAST...be able to crank out parts fast to make a profit. Unless you are a precision machinist doing one-off custom work.

There are a few world-wide trends that may be happening. First, we may be starting to see the end of inexpensive Chinese goods...do to their demands for higher quality of living, rising petrol costs (trans-Pacific transportation), as well as the recent Chinese natural disasters. From what I gather, China has halted foreign goods exports so that they can use products to care for their own. So, with things like this starting to happen, we may be starting to see the re-emergence of domestic manufacturing. But in the news today is about US automakers opening new plants in Mexico in stead of the US. And recent increase in Mexico manufacturing is starting to hurt the Chinese economy.

There is a shortage of skilled craftspeople in the US. Unfortunately, most smaller to mid-size companies do not have the resources to take on apprentices or run extensive training programs.

Cheers

Will Kutler
B.S. Manufacturing Engineering Technology
AAS Machine Tool Technology

Posted by Joshua Waaland (Member # 287) on 06-02-2008, 11:33 PM:

Thanks guys. My dad is actually a hobby woodworker and I grew up making table lamps and stuff on his woodworking equipment. He runs a successful catering business or I would ask him to go into business with me. He has the knowledge with woodworking and running a business and I have the metalworking knowledge so it's too bad we couldn't do something together. My wife has her MBA so I can tap into that business knowledge when I need to also.

I'm not so much wanting to run a machine shop as I know there are tons of guys out there more knowledgeable and experienced than me and it is too competitive like you said Will. In fact, while working for my current employer I have gotten to know some guys who own a small machine shop where we take all of our work to. I would rather take the work to them or farm it out elsewhere and stick more to selling, marketing and growing the business. I can assemble the parts and wire the equipment and just have local suppliers. Just need to figure out what to make that will be a success.

I have half considered making automated welding carriages to compete with my present employer since I understand them inside and out and the inherent problems that come with them. They have bought up a dozen little guys like me that were in competition with them. I already know the markets and the customers. hhhmmmm....something to think about.

Adam, is that heat exchanger something that you are looking to sell to your customers?

Posted by Mark Gulbrandsen (Member # 72) on 06-02-2008, 11:46 PM:

quote: Joshua Waaland
and to be able to send my kids to college.

Thats a great idea but you'd better be quite wealthy by then to do that! If not then hopefully they could get scholarships.

Posted by Adam Fraser (Member # 1074) on 06-03-2008, 09:46 AM:

Joshua,

The heat exchanger is something that there are only two suppliers of, both of which are between production cycles on them. It goes under the supercharger of a newer car reducing detonation. I currently don't sell these but would be interested if I could find a supplier, there is a fairly large market for these and a short supply.

The only problem is that the other two vendors are more established so my price would have to be a fair amount less than theirs with similar quality.

Posted by Louis Bornwasser (Member # 3063) on 06-03-2008, 05:43 PM:

There is such a glut of manufacturing capability here that there is more money in brokering that extra ability. I know of two shops that shut down while the former owner went into brokering.

"Few pennies": I can get a 10 to 1 variation on sheet metal and machined parts quotes.

Good luck, but don't get "eaten alive" by the volume operators. Louis

Posted by Scott Jentsch (Member # 1681) on 06-04-2008, 03:12 PM:

Whatever you decide to do in your self-employment, make sure it is something you love to do and are willing to do it even if you're not being paid.

I say that as someone who has been self-employed full time for 5+ years after running the business part-time for 6 years before that. It has taken this long for things to finally come together and for decent money to come in (as in, no longer losing money hand over fist). It will probably be a few more years before I reach the goal you are striving for; that of financial independence and being able to save for the big expenses of life (college for the kids).

For these last five years, I've been working 80-90 hours per week and much of that time was spent building my business, making contacts, and working on projects because either they should be done and I was best-suited to do them or they were good experience for me. It's amazing how many people come out of the woodwork when you're self-employed expecting you to do their projects for free because you're their friend, neighbor, relative, etc., and how many requests you get on your time because you don't have a boss or company dictating your schedule any longer.

Be prepared to never be very far away from your job in your mind. When you own your own business, it becomes part of you, and you never leave it. Even if you are miles away from your office/shop in body, you are thinking about the business in your head, trying to lay things out, make plans, or organize your thoughts so you can be more successful.

But maybe that's just me... [Smile]

I could not have made it as far as I have if not for the support of my wife and kids, and the fact that my wife has a stable job with excellent health insurance. Anyone that does not have the emotional support of their family and the financial ability to sustain the loss of income for one or more years has a tough hill to climb to succeed.