how did you get started? what worked for you? did you do it alone or with partners? how did you finance it? bring in customers? I would like to hear what it took to get going and how well it's working out for you. I am seriously thinking about starting up a small fab/custom/rod shop and want to hear some real world advice and experiences. Paul
If you ventured past a back yard under the table cash only operation (illegal) here in CA you'd have to memorize and follow all said in these pages; http://www.dca.ca.gov/ http://smogcheck.ca.gov/StdHome.asp There in the wet state you'd need to memorize this.
in AZ I didn't have to memorize anything, I just had to apply for a transaction privelige tax license. And pay sales tax when appropriate, and of course federal and state income tax. But I've never had any employees, and I've never had to actually support my family (wife has a good job), so I don't know what it takes to really make money. I got started by renting 1200 feet in town, and putting up a sign, and telling folks I knew that I was opening a shop. It was mostly just repair work at first, eventually I did more hot rod work, but pretty much all mechanical stuff. Joining the local car club helped a lot with finding customers. I quit a good paying government job and spend half of the retirement contributions they gave me back to open the shop. After about 4 years of learning a lot and not making much money, I ended up moving out to the country and building a nice shop, and working part time at it. Now I hardly ever do any work, laziness has taken over me.... Hopefully some successfull guys will tell us all how to do it right. My guess is that having a lot of ambition and being hungry would make a big difference!
this might help some. http://www.jalopyjournal.com/forum/showthread.php?t=12811&page=1&pp=20&highlight=shop+owners http://www.jalopyjournal.com/forum/showthread.php?t=23916&highlight=shop+owners
Well I got started when i got fired for being incompetent from a tractor repair company. I already had a shop I worked out of at night and I had some dudes who wanted to pay me to work on their stuff. So my choice was either get a job again or try the dream. That was 4.5 years ago. I used to bid jobs, but I'm to much of a perfectionist and it killed me. Plus I thought the bid hurt the customer because I had to rush to get it done on budget or I started losing money. Plus customers change their mind daily. And you never know what it is gonna take until your almost done. I did it with just me and my Dog, Jake. And lots of long long long days. I had about $2000 and I bought a plasma cutter, and paid some bills. I advertised in the local car trader when I could and word of mouth, I did not even have a hot rod that ran at that point, I was still building it. I have always been too honest with customers. In the beginning I would do anything to keep the doors open. Trailers, lumber racks, paint street sweepers, Chevy luvs, 4 wheel drives, what ever it takes to keep the doors open another day. It took lots of hard work and if I was married I'm sure I would be divorced. My rent at home was $250 and my shop rent was super cheap at $300 for 2000 square ft which is a super deal. The main deal is to keep your over head low. I see guys open shops and go buy all this fancy tooling that I now have just so they can compete, but then the tool just sits or they use it on their car but IT MAKES NO MONEY. I only bought tools I needed until I started makin money. I also just built everything for my cars, when I started having time to work on my junk I did not have extra money also. So I just made everything. It has worked out great I guess I have 3-4 employees. We are in out 3rd shop in 4.5 years. We are currently building 11 cars. Everything from chopped 49 and 53 caddys and mercs to a 34 3 window and a 55 chevy straight axle g***er to 2 4 wheel drives. I have tons of tools now. Still trying to figure out my pullmax. i guess my 2 cents would be to keep your over head low and don't try to grow to fast. Don't for any reason ever do ****py work, even if it means you lose money on that job. If you think you are only going to build hot rods that are cool you better stay in YOUR garage. I almost think if you don't have a wide taste in cars, YOU WILL STRUGGLE to specialize in one style unless you get super lucky. I got lucky with my shop and I have worked on some stupid things to just pay the bills. I still do some times. I have web site www.ironworksspeedandkustom.com
If you build it, they will come. I opened a shop over in Gig Harbor years ago (70's) and had customers from day one. Your reputation and the shops reputation will determine the flow of traffic. We had plenty of work. We (I had a partner) also had no sense for the business side and this led to our finally quiting. I think this is as important as your skills in the shop to say the least. That aspect took some of the enjoyment out of it for both of us. Now I work for 'the man' and do hot rods and motorcycles at home as a hobby. No stress and more fun for me. Your skills on the floor are one thing but your skills in the office are the $$$.
We have a junk shop not a fab shop, but we started with $500 and rent we could cover with our day jobs. 6 months later it was our full time gig. We have been in business 9 years. If you want a job done right do it yourself and don't get involed with partners. Just my opinion.
i have owned customs shops in the past (mostly specializing in the lowrider field) but closed after a couple years due to a divorce. i then opened and built up shops for other guys and spent years doing that. 3 years ago i bought a towing company and quadrupled its existing biz and income. i am now opening a new custom shop (opening july) in a 13000 sq ft building in an ex chevrolet dealership from the 40's (cool huh?) we will be doing complete builds, sales, repair, motorcycles & rodz.full in-house paint. And a 2300 sq ft show room. and large inventory. i was lucky enough to get a big building in prime dowtown location and at less than 50 cents per sq ft on the rent. i feel that the best advantage a new shop can have is making sure you treat the customer like a friend, whether they stroke you around or not...one day they will be ready to build, and when they are, they will remember the shop that treated them as an equal. i feel this is one of our major advantages as well as im still young and motivated (29) and owning a successful towing company backing my play in case of hard times doesnt hurt either. making good connections with your suppliers helps alot as well. we have some suppliers that reroute biz back to us. working with local car clubs and making sure you hit every weekend run you can will always throw your name out there. but making sure you do quality work is key one.
Paul Ive seen your work-you are qualified and you will do fine!. I would say this....One should not be afraid to start at the bottom and also not be dissapointed if you dont make it to the top...... What Im saying is -learn to be happy with what sucess you CAN achieve. I started my bussiness full time in 1976-I had been moonlighting it for about five years previous to that date. I find that if you treat customers as you'd like to be treated -it works well for both of you. My advice is this- 1-Dont price yourself out of a job- see what comparable shops charge and make it a point to be significantly lower in labor charges yourself-[ie-50 dollars an HR is great unless you are out of 50 dollar an hour work then you are makin nothing! ] 2-only bid things you are absolutely sure you can accurately predict 3- [also Id suggest to stay out of the painting and complete car builds if I were starting new.] I wish you all the luck on this new chapter in your lifes work, Man..... Kenny
My answer is kind of out in left field so it may not help you . I have a gOOOOd job ,but I'm not particularly happy to go to work every day . I have a 24 x 36 garage in the back and have been working out of this one for 14 years. I do not however have to pay household bills with my car earnings or nor does my weekly paycheck pay any car bills. In order to keep the City and my insurance man happy I buy cars and parts and ***emble or fab stuff for them in my garage. They then are my vehicles and parts and I am not accused of running a commercial shop.I then have them for sale all the time and if they go they go,start on another. This allows me to set my own timeline. Several years ago two different shop owners told me the same thing ,do not hire any employees unless you are tired of doing the work yourself. You spend way to much time managing and not doing what you love to do . I seem to be in a good place for buying locally and reselling on Ebay,I have averaged $450 profit a month for a year or more. There is Gold in those junk auctions and Garage sales sonny. I will be retiring in a year and will head at this with a vengence,Luckily I already have the tools and some experience. My opinion as the biggest mistake new shop owners make ,they discount intially to try to build business but then can't seem to get the prices back up when work gets around. Hey it's just my opinion ,I could be wrong!!
Paul, I think every statement made here is true, I've had my own machine shop for over 15 years. My wife has a good job,and that's the only way I was able to do it. I refused to borrow money that went against my house, spent most everything back in tools. You will never have enough or the right tools. NO PARTNERS! I worked for 2 new co.s that were partnerships, they both failed in less then 5 years. It will be the most fun and biggest nightmare you ever have.
Paul : With your skills & creative ability ,you should have no problems getting customers...!!! I've been self-employed for the last 4 1/2 yrs and it's been the best thing I ever did...But... It's also very scary when you're outta new work and the phone ain't ringin'...however , the upside is that it makes you dig even harder and the next thing you know ,you have more work than you can do!!! In my case , I borrowed a very small amount to buy a piece of equipment and worked it part-time & weekends for little over a year while I paid off the machine and built up my customer list . Then one fine Spring morning ,I walked into my regular job and told them to stuff it and never looked back... I do agree that you must have a business plan , but sometimes you can study a proposed business til you can talk yourself out of it..My advice on partners is ...be very wary of any type of partnership..lots of business fail because of conflicts between partners... operate it yourself ,do not be timid about asking for a fair price ...stay on top of operating/supply /material expenses.... Good luck to ya Paul !!
Paul, I would start at the bookstore. There are tons of books on starting a small biz. You obviously have the technical skills, and maybe the biz skills too (I don't know). Just don't become a NW version of Boyd Coddington
Tough call Paul. Geeeze, everyone would want to jump on the band wagon, especially for a talented person like yourself, and tell you to go right ahead on it but in today's world one must think of a few things. Friends and family will screw you quicker than anyone else. Gold chainers don't complain to you, they compalin to their lawyers and a lot of that goes on in Puget Sound. But probably my main concern today is health insurance for you and the family. Insurance premiums are out of control for many reasons but I would bet that just your health insurance for you and the family alone would be 6 bills a month and then you have to have liabillity and all the other things for the shop so before you turn the light switch on you'll spend over 1 grand a month, every month whether or not you have any income. What you do in your garage you can do for a reasonable rate but if you go on a public basis your rate will have to escalate to 50, 60 big ones an hour just to keep the compressor running. It's not an easy task. I personally know that you would do well with your work but when you have to handle the public on top of it all can go to hell in a hand basket in a hurry. Don't let me turn you away from your dream. Just do a good job of researching your cost of operation and your market. Mike
Paul! Don't know how to ad the post here but I was reading the message board and found a post from "FRITZ" ***led........."A question for independent shop owners". Have a look at it. I'm sure it will leave you with some good info. Mike
Just this last Tuesday was my 10 year anniversary if moving into my house and opening the doors on my business (Northwind Welding). First, since I started from scratch, I found a home located between many smaller towns. That way it's only 10-15 miles from Cable, Grand View, Drummond, Hayward.... I have a portable welder, on a trailer, and that brings about alot of work I wouldn't get, otherwise. I had the propery rezoned for my welding business as a contingency of the sale, and worked from the 24x24 garage for 6 years. Then, I built my shop, on the same 10 acre property. I saved alot of money by doing the wiring and concrete work myself... but it took longer and was a pain, while I needed to be making money. No rent or other outside overhead made the difference, here. Plus, I'm the only welder within 50 miles... not to mention the best. Don't overdo advertising... especially recurring bills like the yellow pages. Keep it simple and let your work advertise for you. Posters and business cards are cheap and do just as much good, if they're in the right place. Don't forget... EVERYTHING about fabricating and welding is consumable... even your clothes. Don't go broke by not figuring in every cost. Cutting wheels, compressed gas, tank rental... LIABILITY INSURANCE (You're playing with fire)... My involvement with cars has saved my ***, since my ex left, three years ago. Up here, you have to do more than one thing to make it, too. When she was here, we ran a limo business, as well. I make and sell metal art and ALOT of ornamental handrails, gates, fireplace screens, spiral stairs... etc. Pick up things to fix and sell. I do a few boats and 4-wheeler projects, if I can get them cheap and straighten 'em out cheap. The biggest thing is setting your rate. That's my biggest downfall as a businessman. I don't like taking people's money. Sounds stupid, but it's true. I've done a week's worth of work, written the bill, and knocked hundreds off, just because it looked too high. ********!!! Remember, you aren't in business to subsidize anyone else. As for my 10th anniversary? I raised my shop rate from $50/hr to $75/hr. Time to start making it worth my time, effort, skill level and the amount of my investment in the building and equipment. When I go to a 25 year old dentist, and a 1 1/2 hr. root c**** costs $500.00, it's time to evaluate what my 28 years of expertise is worth. Here is a very interesting read on setting your rate. http://www.brennerbooks.com/rates.html In all these years, I've, maybe, had 5 people complain about cost... That's not enough... believe it or not. Hell... I'll sell you my place... and all the cars (not the '32 stuff) for $250,000. I can be out in a month. Anyway... Best of luck. JOE
Paul I onced owned a business in Washington. I spent between 6 and 12 hours a week working free for the State of Washington. It wasn't too bad until I got set up to hire employees. It was the additional paperwork to have employees that took all the joy out of my business. If I were doing it again the first thing I'd do would be to hire a good lawyer and the best accountant money could buy. Not fully understanding the tax issues cost me more cash than I had early in the second year. Another piece of advice from my experience: carry good health insurance. One personal health issue wiped out all the profit and more ready cash that I had. Three years into my adventure, I felt like I had made it through the start-up phase and was doing good. Over a period of a few weeks suddenly I owed every dime I had, plus quite a few I didn't to one of our local hospitals. Take on a partner if you can gain someone you trust who compliments you well. Someone with strengths in areas you don't and who isn't as strong in the areas where you are. I don't have the skills or reputation to start a rod or fabrication shop. I do have the skills to provide the money generating part of a couple other buinesses. I lack the paperwork skills and discipline this state makes absolutely necessary to get by. I'd probably look for a partner with business admin skills if I starting a business.
Paul, I opened my auto/light truck repair shop in 1990 in a 1 1/2 bay garage as a 1 man operation & well long story short have created a monster,I now own a 8 bay 4,200 sq foot shop on an acre, have 4 employees not counting my wife or accountant & opened a 24/7 tow company with 3 trucks to compliment the auto repair in 1995. There are days when I get to actually take a minute & take a breath to look around me & when that moment comes I think to myself, "if I had it to do over I would have stayed in the small 1 1/2 bay shop working by myself", no one to worry about but myself, no big bank payment overhead, no out frickin rageous insurance payments, no huge property taxes, uniforms, L&I, workmans comp, x-mas bonuses, keeping the schedule just right for all the employees, employee needs, wants & demands, blah blah blah, other than that things are wonderfull Keep it small, dont over extend yourself right off the bat, no partners(that way you always do it your way), buy equipment as you need it not as you want it ( do as I say not as I do), ALWAYS do quality work, keep your rates in the middle or close to the high end of your compe***ors to start, (you dont want the price shoppers as your customers, they will snivel & whine the most), find a good insurance carrier (ask around, Mine has been fair as far as insurance companies go) & dont let someone talk you into doing an inferior job just to save a couple bucks, p*** & let the next guy take the rep as a hack. Good luck if you decide to go for it, Uzek
I'm gonna change my answer... Do one or the other.... you can't do both. I just shut down my welding business, today... I'm going to work on cars. The money can be good in welding, but the overhead is brutal... and, for me, it seems that the welding is a distraction from what I want to do, and what has been making me the most money in the last few years. I contacted many of my clients and told them I'm taking some time and rethinking everything... and am not taking on any more work... **** it... JOE
What do you mean by small shop owner. A small shop, or a small guy owning it? Now that i have your attention, the best thing you can do, if you're decent at what you do, is ****ing do it! By that, i mean get the work in and out. I've found so many ***holes take in more work than they can handle, spend the up front money, and bury themselves. Never getting caught up. If you do decent work, and get it out "right away" it automatically makes you better than you actually are. Seriously. If you do GREAT work and take forever, the customer's still gonna talk **** about how you screwed him around. So, if you do decent work, get it out right away, and have fair prices your business should snowball at a rapid pace. THEN, you inch up your hourly shop rate a little at a time til business tapers a bit (optional). Don't take on too many ******** long term projects out of desperation, but if you do, get about HALF the money up front, 25% more in the middle of the job, and the balance upon completion. DON'T put the front money in your pocket. It's NOT YOURS! You put it somewhere safe, and draw on it as you earn it! If you're broke and need money, go to the shop after dinner and EARN it! Then, and ONLY then, can you take money from that safe place. I ain't ****tin', you'll **** yourself if you start spending that money before doing the work. On a new "project length" job, tell the customer your hourly rate, invite him to leave the car a few days, and then say you owe me "X" amount of money, and this is what i fixed. "IF" your pace suits him he leaves the car, if not, he takes it home at this point and he's only out a couple hundred dollars(but has some stuff fixed).
PS-as far as how to bring in customers, it ALWAYS helps if you've been doing little side jobs all along and have a little following. From scratch, i don't know.
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