How are you monetizing your laser?

[Jay Selway]

Just curious what most people in the forum are doing to monetize their investment. Or, if it's just a hobby, that's cool too.

[Kevin Gregerson]

For my Customers I point them at the High Value Materials Database subscription and say that pays for the building, employees, and your machine. Some of my customers make 1300-2600 an hour off just that. Though, there is the other side of the equation like Aerospace that use them for very specific and important tasks like stripping PTFE wire coatings.

It really depends, out of all the customers I've worked with so far. Every one of them paid for it in less than a year with the only exception being the dude who bought it as a toy.

[Jay Selway]

For my Customers I point them at the High Value Materials Database subscription and say that pays for the building, employees, and your machine. Some of my customers make 1300-2600 an hour off just that. Though, there is the other side of the equation like Aerospace that use them for very specific and important tasks like stripping PTFE wire coatings.

It really depends, out of all the customers I've worked with so far. Every one of them paid for it in less than a year with the only exception being the dude who bought it as a toy.

What is the High Value Materials Database?

[Jay Selway]

Are most of you guys just doing for-hire engraving work (awards and stuff like that)?

[Kevin Gregerson]

What is the High Value Materials Database?

It's an add on to the materials Database of Universal Lasers Systems that customers can purchase and pay a yearly subscription fee for. It's only for the VLS, PLS, and ILS, XLS models, it does not work with the older VL, V, X, M, E models. Essentially it provides you with the ball park settings for cut, mark, and kiss cut on a large number of high value materials.

Most of the people here I've noticed are doing trophies etc.

[Mike Null]

Kevin

You neglected to mention that there are a lot of people with machines who are getting $30 an hour and can't pay the bills and a precious few who command the rate you mentioned.

[Kevin Gregerson]

Kevin

You neglected to mention that there are a lot of people with machines who are getting $30 an hour and can't pay the bills and a precious few who command the rate you mentioned.


It's really all about materials in the higher end. A lot of those guys tend to buy bulk in a material for better pricing so they can get 40%+ on the materials + pricing machine/labor time at 30-160/hr for the customer. Pricing per hour really depends on tolerance. If it's half a thou, then you can charge a bit more as setup takes a bit more time, machine runs slower etc. If it's 30 thou well you can charge a bit less.

You can also charge setup fee's, etc. I've seen setup/tooling fee's ranging from 20-600 dollars depending on the volumes, materials, and what you want to do with them. Ie marking, kiss cuts, full cuts, noble gas assist required.

When the numbers add up at the end of the day it's about making employee's more productive than anything else which pays for everything.

[Jay Selway]

It's really all about materials in the higher end. A lot of those guys tend to buy bulk in a material for better pricing so they can get 40%+ on the materials + pricing machine/labor time at 30-160/hr for the customer. Pricing per hour really depends on tolerance. If it's half a thou, then you can charge a bit more as setup takes a bit more time, machine runs slower etc. If it's 30 thou well you can charge a bit less.

You can also charge setup fee's, etc. I've seen setup/tooling fee's ranging from 20-600 dollars depending on the volumes, materials, and what you want to do with them. Ie marking, kiss cuts, full cuts, noble gas assist required.

When the numbers add up at the end of the day it's about making employee's more productive than anything else which pays for everything.

Kevin, what kind of service are you performing with your laser? What kind of high value materials are you referring to?

[Scott Shepherd]

It's really all about materials in the higher end.

You do realize that in order for their to be a high end, there needs to be a low end too? That's Mike's point. It's easy to say "Marking Medical Devices is Insanely Profitable! You can make $1000 per hour". Well, that's true. But it's also true that people already have existing relationships with vendors and simply buying a laser, picking the phone up, calling a medical device maker, isn't going to get you a 6 figure contract. It takes a lot of work, years to develop relationships. I've spend 3 years trying to get an opportunity to quote for one customer.

I feel like I'm at a trade show listening to a sales pitch. Out of the 1000's of people that have been on this engraving forum over the last 7-8 years, I can count on two hands people that I think have really hit home runs and gotten to the golden goose. In reality, I agree with Mike, there's a lot more people making little to nothing than it is making the money you're talking about.

[Scott Shepherd]

Most of the people here I've noticed are doing trophies etc.

Are you sure you're on the right forum? Trophy questions almost never come up. How'd you make that leap?

[Pete James]

Unfortunately, Kevin's comments are what you get when the responder is more interested in selling lasers and subscriptions for "ball park" settings for high value materials than answering questions. Posts of this nature are no more than advertising.

[Dave Sheldrake]

Turning $2600 an hour in sales isn't that hard Kevin, what that leaves out is the ancillary costs. I've done marking and cutting work on sealing rings for unspecified nuclear facilities and sure they can pay $2,000 a time to have something processed but to get those kind of contracts requires far far more than a material database or a ULS laser set up in a garage.

I'm more inclined to think that those turning $2600 an hour are doing it with a laser, the fact it's a ULS is academic at those pricing levels as the laser is just a very small cog in a very big wheel.

Extensive, field tested material databases come with just about every industrial laser at no extra cost and are available online from them without a subscription fee. Without exception they are all successful start points and never a definitive answer to the materials question as there are quite simply too many variables involved.

As to high value materials....gold, platinum and such like may seem like high value but when compared to some of the exotics they amount to little more than pocket change and most of those exotics are materials that NO ULS laser ever made will cope with.

cheers

Dave

[Kevin Gregerson]

Are you sure you're on the right forum? Trophy questions almost never come up. How'd you make that leap?

Just seems like it... I've seen a fair bit of MDF, small bit of metal and ceramics, and a few polyethylene postings but nothing on the higher end materials like Phenolic, fiber board, Kapton Films, etc.

But yes, I will agree there are a number of guys out there doing smaller jobs and making a fair bit with them or just getting by. It really depends on what you want to do.

There are a million different processes for using a Laser. By itself, I've only got about 5 clients who are successful with the machine by itself. I say successful starts at they make money on it and it pays for itself and the small shop they run plus some salary which is usually a shed or a small office somewhere. The ones that do better with this are the ones that make a patented product that they sell ontop of the job shop work they get or the ones that deal with high value materials.

The small retail sign shop also is moving more and more towards just a small machine because paying 8-12 dollars to someone else or making it for 3 dollars is just too profitable on the retail end.

The customers I have making that kind of money from the machine are Machine shops, Converters, retail sign shops, large volume marking, cutting, and ablating/marking operations. You need to either have some sort of in your face marketing to go with it or be well known among your clients as an expert in the field which is again sales and marketing and making sure that your client mix isn't such that 70 percent of your revenues are with one client.

[Tim Bateson]

So where we are going with this thread is if I had wanted to live life in style and retire early I should have bought a different brand of laser? :cool:

To answer the original question and to agree somewhat with Kevin's last post.... I diversify. Some days the laser is a money printing machine (not the pie in the sky stuff like above, but $120-$300/hr). Other days it's idle. That's why I do more than use a laser. If one machine is idle, another is likely busy. Unless you are one of the lucky few with a mega contract, it's the only way to survive.

Now specifically to "monetize" - Learn your machine, it's capabilities and just as important it's limitations (it does have limits). Also your capabilities and limitations.

[Ross Moshinsky]

I don't think the question should be "how do you monetize your laser?" but "do you think I can make money doing X, Y, Z?"

The laser is a tool. You're the business.

[Martin Boekers]

[QUOTE=Kevin Gregerson;2316887]

I've only got about 5 clients who are successful with the machine by itself.

The customers I have making that kind of money from the machine are Machine shops, Converters, retail sign shops, large volume marking, cutting, and ablating/marking operations. [Quote]


Kevin, I'm a bit confused.... Do you own your own a laser engraving business, or do you sell lasers? From your quote it sounds like you sell lasers... I think if you're are a salesman or manufactures rep you
have to post it in your signature block. It really sounds more like your selling than engraving.... Anyone here making a $1000.00 + Plus an hour please rise..... ;)

[Scott Shepherd]

Marty, I think he's said it before, I think he said he retired from selling Universal Lasers.

[Dan Kozakewycz]

Mine is predominantly used as a tool to produce my blueprint artwork. Earlier this year via crowdfunding, that artwork raised enough in 6 weeks to buy a Trotec Speedy 100 outright, so I'd say that product alone is enough of a money spinner.

As a sideline, I will be offering the usual 'for hire' services in the local vicinity (on an island, no other competition to my knowledge), as well as making odds and sods as a hobby.

Maybe in future the 'for hire' side will overtake the blueprints... who knows.

All I know at the moment is, it feels like I'm working my arse off for no money because all that money is in the machine sitting next to my desk. Hopefully next year I'll start earning from it.

[Keith Colson]

I am enjoying reading this thread. Right now my laser only runs about 6 hours a week but it always runs at a minimum of 65 per hour. What I would like is to get that up to 15 hours a week. Primarily it is a tool that goes with the rest of my services. e.g. I can laser cut an enclosure, gears or printed circuit boards quickly. I also do a bit of optic work which is good too.

What I would like is to find some more high end work or make some products that I can turn over. I have some ideas and have tried a few things but have not made much progress yet. Any ideas?

I like working with the laser cutter so the more laser work I do the less "other work" I will have to do which would be nice. I have only had my machine for about 9 months and I got it for a song, so there is no rush on the payback. The most important thing to me is variety and joy in my work.

Cheers
Keith

[Dave Sheldrake]

Make something people don't need but want Keith,
People will always try to save money on what they need but will often exceed budgets to get what they want,
Don't fight your way to the bottom of the price bracket,

The one thing you have is enjoyment of what you do and that is worth more than money can buy ;) trust me getting bigger and having the monster machines isn't always what it's made out to be or I wouldn't be sitting here at gone 4am doing paperwork for the office that I'm due back into in 4 hours and I haven't been home yet.

cheers

Dave

[Jay Selway]

I don't think the question should be "how do you monetize your laser?" but "do you think I can make money doing X, Y, Z?"

The laser is a tool. You're the business.

Yes, I understand that. I know how I'm going to use this tool as part of my arsenal, I merely was curious what other people were doing.

Sheesh.

[Jay Selway]

Thanks for all the great replies. Great to see everyone's different uses.

Personally, I'm going to be developing a line of products to sell, with a chunk of profits going to help kids with brain cancer and their families. I'm betting that people will pay a little more for high-design if it's for a good cause :)

I've also been looking at partnering with high end creative production studios. I regularly contract them through my job (I'm a creative director at an agency) and it seems to be an underserved market.

Mostly though, I'll be making art that hopefully people will buy.

[Mitchell Tutty]

I think the biggest mistake for anybody running a business is limiting themselves to "a line of products" or just one particular industry in general.
Diversify, diversify, diversify, you'd be stupid in being content with sticking to one industry.

Even if you manage to get one of these so called golden contract deals where you can charge yourself out at $2600 an hour, nothing is secure. What if the business you're supplying shuts down completely, goes bankrupt? What's to say they wont find a better supplier? Or punch in some simple numbers into a calculator and realise they're wasting a lot of money and they could of bought their own top of the line laser and paid for it twice already.

[Chris J Anderson]

Or punch in some simple numbers into a calculator and realise they're wasting a lot of money and they could of bought their own top of the line laser and paid for it twice already.

Thats exactly how I think.
If I overcharge, I just encourage clients to go elsewhere.

We can easily think that providing laser services is a specialty business, but anyone with reasonable pc knowledge, and ability to learn software quickly can compete with us.
Yes, theres a learning curve, but it really isn't super specialised.

I sort of compare my rates to somebody with a business with a similar machinery outlay, e.g.: a person with a Bobcat and small truck. Say 50 grand worth of gear second hand, and they charge around $70 - $80 per hour.

When I do some jobs my machine makes $200 per hour, at other times $40.

As long as it averages out, all good...

[Dave Sheldrake]

Personally, I'm going to be developing a line of products to sell, with a chunk of profits going to help kids with brain cancer and their families. I'm betting that people will pay a little more for high-design if it's for a good cause

As soon as you have a product let me know Jay, I'll be your first customer. There aren't too many left like you :)


We can easily think that providing laser services is a specialty business

That's all down to machines Chris, the market is diluted dependant on the number of machines in the price bracket.

K40 owners have a LOT of competition
Chinese Box machines have a large & growing amount of competition
Western made machines have less but still a fair size chuck of others doing the same
Small industrials have a few of the slightly larger companies competing
Big industrial machines only have a few competitors

I live in a country of around 75 million population and yet not one sole trader as a competitor as the machines simply cost too much to buy for individual businesses. A job comes in for tender cutting large sheets of 10mm aluminium I don't have to worry about somebody with a laser in their garage quoting lower than me.

The specialised sector of the market seems to be controlled by machine cost, the more they cost the less you have to compete with and the more specialised your services become.

cheers

Dave

[Martin Boekers]

Thats exactly how I think.
If I overcharge, I just encourage clients to go elsewhere.

We can easily think that providing laser services is a specialty business, but anyone with reasonable pc knowledge, and ability to learn software quickly can compete with us.
Yes, theres a learning curve, but it really isn't super specialised.

.


An interesting thought about business, some want to control all aspects of it, others realize that they don't have to. They would rather job out portions and make their money
doing what they do best.

As far as being able to learn the software quickly and it's not so specialized I do beg to differ on that.... I been working with lasers, engravers and printers, cutters, sublimation
(9years engravers, 30+ in graphic arts, trade shows etc) Yes, to make a plate or a nametag it doesn't take much experience. To maximize quality, efficiency & profit that's another story..
I learn something new everyday. Maybe a quicker way to convert a graphic, adjust it to make it engrave a bit nicer and quicker. As far as completion goes we buy from similar vendors
at similar cost so not much room for competing on pricing. I make up the difference by efficiency which comes with learning the software better than most, making that curve a bit
steeper. If it takes the 10minutes to design a job and I can do it in 5minutes.... then I'm already a head of the game... The laser is easy to learn the software takes a lifetime.

If you just want the learn the basics, lots of competition, Excell in understanding the software you narrow that field greatly...

"many can strum a guitar, few can play it"

[Lee DeRaud]

...the only exception being the dude who bought it as a toy.Wait, there's another one?!?

I bought the laser as a pre-retirement gift to myself nine years ago. Still a toy...a very cool toy, but a toy nonetheless.
I occasionally sell stuff that was made using it, but that was not the point of the exercise.

[Tim Bateson]

"many can strum a guitar, few can play it"

Man! You burst my bubble! :( I was all set to go on tour too. :D

[Dave Sheldrake]

You really want your ears to bleed you wanna hear my rendition of Star Spangled Banner on a BC Rich Warlock :)

Sounds great when I have ear defenders on (Although the National Anthem sounds great to me no matter how it is played,by who on what)

cheers

Dave

[Lee DeRaud]

I think the biggest mistake for anybody running a business is limiting themselves to "a line of products" or just one particular industry in general.
Diversify, diversify, diversify, you'd be stupid in being content with sticking to one industry.Yes, but designing your business model around your tools instead of the other way around is a sure loser too.
And we average a person a week asking, "I'm thinking about buying a laser...what sort of business should I use it for?"

[Kevin Gregerson]

[QUOTE=Kevin Gregerson;2316887]

I've only got about 5 clients who are successful with the machine by itself.

The customers I have making that kind of money from the machine are Machine shops, Converters, retail sign shops, large volume marking, cutting, and ablating/marking operations. [Quote]


Kevin, I'm a bit confused.... Do you own your own a laser engraving business, or do you sell lasers? From your quote it sounds like you sell lasers... I think if you're are a salesman or manufactures rep you
have to post it in your signature block. It really sounds more like your selling than engraving.... Anyone here making a $1000.00 + Plus an hour please rise..... ;)


My sign says I do technical application and service for one of their channel partners which is more or less the technical portion of a sales process setting up a production line or finding the solution that gets a customer up and running. I'm pretty familiar with the details and I'm still learning about other solutions. Because at the end of the day there really are no bad lasers per se but bad application analysis that leads to getting the wrong solution. My education online is purely about helping people figure out what they want to do and how to figure out which machine they want because there is nothing I hate more than coming across a customer with ten bandaids ontop of the existing piece of equipment just to make it work and one of them failed which requires sorting out the ten bandaids and the system to figure out what happened.

[Dave Sheldrake]

My Grandfather taught me another adage...

"Jack of all trades is a master of none" ;)

cheers

Dave

[Kev Williams]

http://www.sawmillcreek.org/images/misc/quote_icon.png Originally Posted by Kevin Gregerson http://www.sawmillcreek.org/images/buttons/viewpost-right.png (http://www.sawmillcreek.org/showthread.php?p=2316609#post2316609)

...the only exception being the dude who bought it as a toy.


Wait, there's another one?!?

I bought the laser as a pre-retirement gift to myself nine years ago. Still a toy...a very cool toy, but a toy nonetheless.
I occasionally sell stuff that was made using it, but that was not the point of the exercise.

My dad became a machinists mate in the Navy in WWII. After the war he was a machinist at Hill Field. One day the boss needed a few people to learn to run a few Gorton pantographs. My dad thoroughly enjoyed engraving. In the late 50's he got on at Litton as the machinist's floor supervisor. Litton just happened to have a small Scripta pantograph up in a loft, and dad used it to make desk, wall and cubicle signs and name badges for everybody. He took me in one day when I was about 6 years old, he showed me where he worked, all the machines, introduced me to his co-workers, then took me upstairs where I watched as he engraved a couple of wall signs. That day is still etched in my memory.

In 1966 he bought himself a Scripta pantograph, "for fun". He didn't do a whole lot with it for the first few months, but one day one of his old co-workers who'd changed jobs needed some aluminum ID labels engraved. That's when it started. Those ID labels came in regularly for years. Only a few at time, and only a few times a month, but it was steady. But other jobs came in because of those plates. And other co-workers who'd moved on. One job from Litton netted my dad twice the money of his monthly paycheck in half the time. That was the day my mom forgave him for buying 'that stupid machine'. The engraving business was part-time until the early '70;s, when yet another old co-worker called, he was working for a medical computer mfr, and he needed someone to fabricate plex CRT covers for the monitor bezels, and engrave and paint their logo on them. About that time he bought a used Gorton 3U deep throat pantomill, as he started getting calls about engraving injection molds. Around 1974, another old co-worker now working for Univac wondered if we could engrave computer keycaps. That's when all hell broke loose. Within a few months every computer builder in the valley found out about us, dad had to buy a bunch of NH IRX-IV pantographs, and everyone in the family had to learn to run the things to keep up with the demand. Cousins and sisters were hired to help with painting the keycaps. Me, and 2 brothers-in law had pantographs at home. Dad's job was making us masters on his old Gorton in between engraving injection molds for every machine shop in the valley. Here's a framed press release pic System Concepts gave us, circa 1976, of their flagship 'Character Generator". Love the cassette drive! ;)

297699

In 1981 we bought our first Concept 2000 computerized engraver. Wow, talk about an easy way to engrave keycaps! We bought a second Concept a year later, and I taught my BIL to use it. He's using it to this day... The keycap business abruptly stopped when IBM and Microsoft ended the need for proprietary keyboards. This happened at the same time mortgage interest was 14%. Times got rough. I soon learned to engrave metals and whatever else would fit on the Concept. In 1989 we got our first Vanguard 5000XT, then the 5000, the V3400 orbiter, another 5000XT, and another V3400.. etc, etc...

In 2001 I got tired of phone calls asking if we did laser engraving, so my NH rep sold me his old Optima (ULS) demo unit for $5 large, and suddenly I was awash in black anodized aluminum and stainless steel jobs. Soon to follow was switching over most of the laminate work from tool engraving to laser. Wasn't long before the poor ULS couldn't keep up with the work, so I got the LS900. And it's been right busy its own self the past 10+ years. The laser work has been good enough I decided to buy my Triumph 'Dumpster' (my name for it, its crate was exactly 4 cubic yards, the same as a small dumpster!)...And I'm considering buying a 4th laser. Right now I'm setting up a bunch of duck calls to be lasered in the LS900, the ULS is currently engraving a ton of SS cover plates, the Triumph will soon be lasering a load of cowbells, and each machine has jobs to follow those... my other machines are doing tool engraved cowbells, injection molds, AR lower receivers, ski-lift platform warning plates, laminate labels, and a motorola 2-way radio...

Sorry for the life's story, but this is how I 'monetize' my laser, and everything else. For as long as I can remember I've had work up to my eyeballs. As you can tell, I'm not a "trophy shop". Most of my customers are businesses, and many of my customers are other engraving shops, I get what they can't or won't do. And-- with the exception of our name (not an ad) being in the yellow pages several years ago, and my lame web page which exists mostly as a photos-of-what-I-do webpage, we have never advertised. Thanks to search engines, my page does show up occasionally- And every so often I take down my webpage because of it-- too much work!

--- and this all started because my dad bought an engraving machine "for fun". You only live once.... :D

[Kevin Gregerson]

My dad became a machinists mate in the Navy in WWII. After the war he was a machinist at Hill Field. One day the boss needed a few people to learn to run a few Gorton pantographs. My dad thoroughly enjoyed engraving. In the late 50's he got on at Litton as the machinist's floor supervisor. Litton just happened to have a small Scripta pantograph up in a loft, and dad used it to make desk, wall and cubicle signs and name badges for everybody. He took me in one day when I was about 6 years old, he showed me where he worked, all the machines, introduced me to his co-workers, then took me upstairs where I watched as he engraved a couple of wall signs. That day is still etched in my memory.

In 1966 he bought himself a Scripta pantograph, "for fun". He didn't do a whole lot with it for the first few months, but one day one of his old co-workers who'd changed jobs needed some aluminum ID labels engraved. That's when it started. Those ID labels came in regularly for years. Only a few at time, and only a few times a month, but it was steady. But other jobs came in because of those plates. And other co-workers who'd moved on. One job from Litton netted my dad twice the money of his monthly paycheck in half the time. That was the day my mom forgave him for buying 'that stupid machine'. The engraving business was part-time until the early '70;s, when yet another old co-worker called, he was working for a medical computer mfr, and he needed someone to fabricate plex CRT covers for the monitor bezels, and engrave and paint their logo on them. About that time he bought a used Gorton 3U deep throat pantomill, as he started getting calls about engraving injection molds. Around 1974, another old co-worker now working for Univac wondered if we could engrave computer keycaps. That's when all hell broke loose. Within a few months every computer builder in the valley found out about us, dad had to buy a bunch of NH IRX-IV pantographs, and everyone in the family had to learn to run the things to keep up with the demand. Cousins and sisters were hired to help with painting the keycaps. Me, and 2 brothers-in law had pantographs at home. Dad's job was making us masters on his old Gorton in between engraving injection molds for every machine shop in the valley. Here's a framed press release pic System Concepts gave us, circa 1976, of their flagship 'Character Generator". Love the cassette drive! ;)

297699

In 1981 we bought our first Concept 2000 computerized engraver. Wow, talk about an easy way to engrave keycaps! We bought a second Concept a year later, and I taught my BIL to use it. He's using it to this day... The keycap business abruptly stopped when IBM and Microsoft ended the need for proprietary keyboards. This happened at the same time mortgage interest was 14%. Times got rough. I soon learned to engrave metals and whatever else would fit on the Concept. In 1989 we got our first Vanguard 5000XT, then the 5000, the V3400 orbiter, another 5000XT, and another V3400.. etc, etc...

In 2001 I got tired of phone calls asking if we did laser engraving, so my NH rep sold me his old Optima (ULS) demo unit for $5 large, and suddenly I was awash in black anodized aluminum and stainless steel jobs. Soon to follow was switching over most of the laminate work from tool engraving to laser. Wasn't long before the poor ULS couldn't keep up with the work, so I got the LS900. And it's been right busy its own self the past 10+ years. The laser work has been good enough I decided to buy my Triumph 'Dumpster' (my name for it, its crate was exactly 4 cubic yards, the same as a small dumpster!)...And I'm considering buying a 4th laser. Right now I'm setting up a bunch of duck calls to be lasered in the LS900, the ULS is currently engraving a ton of SS cover plates, the Triumph will soon be lasering a load of cowbells, and each machine has jobs to follow those... my other machines are doing tool engraved cowbells, injection molds, AR lower receivers, ski-lift platform warning plates, laminate labels, and a motorola 2-way radio...

Sorry for the life's story, but this is how I 'monetize' my laser, and everything else. For as long as I can remember I've had work up to my eyeballs. As you can tell, I'm not a "trophy shop". Most of my customers are businesses, and many of my customers are other engraving shops, I get what they can't or won't do. And-- with the exception of our name (not an ad) being in the yellow pages several years ago, and my lame web page which exists mostly as a photos-of-what-I-do webpage, we have never advertised. Thanks to search engines, my page does show up occasionally- And every so often I take down my webpage because of it-- too much work!

--- and this all started because my dad bought an engraving machine "for fun". You only live once.... :D


Awesome life story, I'm curious though, how much did you pay for that LS900? The team has a customer looking to trade theirs in and no one knows what they are pricing for.

[Robert Tepper]

I bought my laser in July of 2012. A Trotec Rayjet 300 with 80 watts of power. I have been in business for 36 years, in the rubber stamp and engraving business. I had wanted a laser for the last 8 years but the price was beyond what I could afford. Prices came down and I had the money to make the investment.

For the first two months all I did was melt and set things on fire. After about four months people found out that I owned a laser and that I manufacture a particular product.

My laser runs 8 hours a day, every day except Sunday when it runs about 4 hours.

I have not analyzed my profit ratio per hour. I do know that my laser has brought in well over $90,000 in revenue in two years and has allowed me to compete in a new market that I was not able to be in before. I manufacture rubber stamps also and that has been exceptionally profitable.

Thrilled to have my laser and happy that it brings in revenue in an area that I could not compete in before. I should be at the factory now with it running but I do have to sleep a few hours a day.

Robert

[Gary Hair]

My laser runs 8 hours a day, every day except Sunday when it runs about 4 hours... well over $90,000 in revenue in two years

Robert - you might want to run the numbers yourself - $90,000 / 5424 = $16.59/hour - 5424 hours is 2 years of 6 days at 8 hours and 1 day at 4 hours. It may be bringing in revenue but that's not very profitable.

[Kevin Gregerson]

He said well over, I'd expect that means it's paid for itself. Plus with the way lasers run, operators typically run more than just the laser

[Bill George]

Robert - you might want to run the numbers yourself - $90,000 / 5424 = $16.59/hour - 5424 hours is 2 years of 6 days at 8 hours and 1 day at 4 hours. It may be bringing in revenue but that's not very profitable.

40 hour work week usually 2,000 hours a year comes out to $22.50 Hr, not that shabby. I think he said that was in added income.

[Gary Hair]

He said well over, I'd expect that means it's paid for itself. Plus with the way lasers run, operators typically run more than just the laser

OK, let's double it to $180,000 - that would be just over $33/hour. How does that seem profitable? Especially compared to your $2,600/hour people...

[Gary Hair]

40 hour work week usually 2,000 hours a year comes out to $22.50 Hr, not that shabby. I think he said that was in added income.

He said 8 hours a day plus 4 on sunday - that's 5425 for two years...

[Mike Null]

Bill

40 hour work week usually 2,000 hours a year comes out to $22.50 Hr, not that shabby.
You confirm the point I made earlier.

[Dave Sheldrake]

Just spoke to an old Uni buddy who now works at ESS0343 as a grade 6 manufacturing tech, he's off to buy a ULS as the figures mentioned are far higher than his salary :)

cheers

Dave

[Kev Williams]

Awesome life story, I'm curious though, how much did you pay for that LS900? The team has a customer looking to trade theirs in and no one knows what they are pricing for.
I just dug up the pictures, it arrived 12-7-04. (I thought we got it in '03, like it, I'm gettin' old!)

It was a year-end deal, and the last model without USB connections, and I got a few grand off. I don't remember exactly what I paid, around $18k I think. I believe it MSRP'd at $22k with the 40w tube.

[Kevin Gregerson]

OK, let's double it to $180,000 - that would be just over $33/hour. How does that seem profitable? Especially compared to your $2,600/hour people...

It's really not in comparison, but my 2600 an hour people will make that 4 hours of a day and that includes the cost of the materials. I'm betting the profit margins are somewhere in the range of 800 per hour. Still much higher, but in regards to lasers if you can keep a machine running 8 hours a day you can lower the margins. I'm betting that for him that 33/hr was profit after costs of running it. In which case you are looking at a likely 60-80 an hour which is about the bottom line of machine time cost.

[Kev Williams]

Many years ago I had a cousin who worked at a battery place. Small place, just an old filling station. He and one other guy were the only employees, together they worked about 60 hours total. One day I asked him how many batteries he sold. He told me from 2 to 8 a day was average. After doing a little math in my head, I said "how does the owner make any money? He's only netting 3 or 400 on batteries, BEFORE paying you guys and overhead! I figure he's only making a couple hundred a day, if that!"

My cousin said "yeah, sometimes less. But the guy owns over 1200 of these places..."

Profit is what you make of it, I guess! :)

[Doug Griffith]

Turning $2600 an hour in sales isn't that hard Kevin, what that leaves out is the ancillary costs. I've done marking and cutting work on sealing rings for unspecified nuclear facilities and sure they can pay $2,000 a time to have something processed but to get those kind of contracts requires far far more than a material database or a ULS laser set up in a garage.

Don't forget the ISO and AS certification requirements that come with accounts like that. Certs don't come cheap and I'm not just talking money. Also, the costs and risks when working with high end materials.

[Robert Tepper]

My laser runs while I am doing other activities. Usually sales on the phone, pad printing, filling web orders, running my old Dahlgren or running the vulcanizers. My laser is like a robot. It just needs to be cleaned and new material added between cycles. Not every job runs at the same rate. Some faster than others. I am very happy with the return on my investment. Everyone needs a specific amount to cover their overhead and I am comfortable with what I am seeing in sales.

The laser is just one of five things that I do. I have always believed in multiple streams of revenue. I plan on purchasing my second laser at the show in Las Vegas later this month.

Robert

[Gary Hair]

I'm betting that for him that 33/hr was profit after costs of running it.

I'm just going by what he said, and he said "revenue" - that's not profit. At anything less than about $75/hour you can't really be profitable, at $16.xx/hour you are losing money...

[Kevin Gregerson]

Don't forget the ISO and AS certification requirements that come with accounts like that. Certs don't come cheap and I'm not just talking money. Also, the costs and risks when working with high end materials.

Yea, the materials database really gets you in the ballpark when it comes to settings on CO2 lasers. Frequently you'll need to adjust up or down based on your environment. The other part of that is also getting good training when it comes to actually running the laser and how to understand material behaviors. Something that Universal does at Corporate for their customers in this market with a materials engineer in the test lab. It's a really good way to understand a little bit of how things work etc.



I'm just going by what he said, and he said "revenue" - that's not profit. At anything less than about $75/hour you can't really be profitable, at $16.xx/hour you are losing money...

75 an hour if it's the only machine you are running yea, if it's just a second or third machine that the operator is running then it's cost of operation drops down a bit. I use the same math for some clients. I ask them how much are you paying your operator. The answer usually comes back at 20-35 an hour. I tell them is he only running the laser? If they say yes, I say you want two machines not one. They ask why I and I say double productivity means nearly half as many dollars per part spent on labor so two machines reduce the cost of manufacturing from 8 to 4.2 dollars a piece. Granted, they need the kind of work it takes to get to that level.

But in this case, I can't really fault him for collecting a consistent check. Lasers have an overall lower maintenance than just about any other tool I've seen out there. So any time they can pay for themselves, it's a good day.

[Dave Sheldrake]

Yea, the materials database really gets you in the ballpark when it comes to settings on CO2 lasers

So does the huge welth of information available from just about every laser manufacturer on the planet without needing to pay for it.


Don't forget the ISO and AS certification requirements that come with accounts like that. Certs don't come cheap and I'm not just talking money. Also, the costs and risks when working with high end materials

Spot on Doug, all this talk of $2600 an hour is cheap snakeoil as far as I'm concerned. Yes I often do jobs that turn OVER more than $2,600 an hour but the associated paperwork, indemnities, insurance, licensing, transportation costs run to around $500,000 a year to do that kind of work. Divide out the costs of doing that kind of work over the annual value of the work and that $2,600 soon becomes $260.
Setting that aside, this spurious rubbish about Kaptons and Fibre sheet being high end materials......it may well be if you believe that ULS are the pinnacle of laser processing but once you start to look at the outside world of lasers (not just manufacturing lasers) you soon realise they amount to a very small ant hill in a very large farm.

[Kevin Gregerson]

So does the huge welth of information available from just about every laser manufacturer on the planet without needing to pay for it.



Spot on Doug, all this talk of $2600 an hour is cheap snakeoil as far as I'm concerned. Yes I often do jobs that turn OVER more than $2,600 an hour but the associated paperwork, indemnities, insurance, licensing, transportation costs run to around $500,000 a year to do that kind of work. Divide out the costs of doing that kind of work over the annual value of the work and that $2,600 soon becomes $260.
Setting that aside, this spurious rubbish about Kaptons and Fibre sheet being high end materials......it may well be if you believe that ULS are the pinnacle of laser processing but once you start to look at the outside world of lasers (not just manufacturing lasers) you soon realise they amount to a very small ant hill in a very large farm.

Depends what you process, sheet metal lasers are an entirely different beast of laser equipment usually in the half a million to walk in the door pricing. Not to mention the growing market for laser welding. There are a lot of lasers out there and there are a lot of applications. Thus the reason I say there is really no bad laser just bad applications.

So yes, this is a small piece of a much larger pie in regards to the revenues of the laser industry as a whole.

[Bill Cunningham]

I'm not getting any younger, so after 25 years I decided to cut back a bit and stop doing stuff that was minimally profitable. About 98% of my customers now come to me via the web, so I'm now pretty well only doing custom laser stuff. I make a comfortable living, and when this laser craps out I will buy another. I'll probably keep working until they carry me out of here in a box. 5% of every job goes into a laser repair/replace fund. I do glassware,sheet glass,award glass, canoe paddles and baseball bats, wood portraits and other photographs, memorials for pets and people, and virtually anything with a lasered photograph. I'm constantly booked at least 5-8 days in advance, evry job is prepaid and I turn down at least 5 jobs a week. Yes you can make a comfortable living using only a laser, but you have to excell at what you choose to do. There are half a dozen trophy shops that have lasers within 50 KLM of me, and I'm also doing all the stuff they can't, or won't attempt. I took. Month's worth of time off this Summer, toured the East coast, went fishing, and spent a week on the ATV trails in the Ontario bush. Time off, is just as valuable as time on!

[Keith Colson]

Hi Bill

Good point about getting customers through the web. I finally got on to page 1 of google for the most common search here in Auckland, New Zealand "just this week". It took me 3 months of fiddling but I am getting 4 to 6 calls a day this week versus 1 call a week. I now have more than enough work. Just shifting from page 2 to page 1 makes all the difference.

Cheers
Keith

[Mike Null]

I am somewhat in the same boat as Bill in that I'm not working as much as I once did but I have done what i call refocusing. I've had a $25 minimum fee for some time now which sends most of the retail types to my competition and it's working as I planned. I've discontinued doing t-shirts, mugs and other sublimated items and I am listing my sand blasting stuff on Craig's List this week. I just sold my vinyl cutter---not enough volume. In my judgment all of these things are nuisance type businesses for me--sublimation because it involves too many retail customers and sand carving because it's too dirty and hard to get a fair price in this market.

I have focused more on my core businesses (as GE says);) and I'm looking at adding another piece of equipment which I won't discuss as it's very preliminary and tentative.

[Dave Sheldrake]

Same here Mike to the extent I don't supply retail at all these days. It's just too much trouble and the logistics can be a nightmare. Trade or other dealers is easy, less customers and bigger job run times.

If I sell widget A at $10 to a dealer (in a batch of 5,000 of them) or I could sell widget A to retail at $25 it gives me the following break down

To the trade : $50,000 return ,One customer and postal organisation
To retail: $125,000 return and potentially 5,000 different customers who all have different expectations and requirements, 5,000 lots of post to organise, 5,000 potential phone calls or emails to respond to, 5,000 questions to answer not to mention me being dead from a heart attack at 55 from stress.

No thanks, I'll be happy with the $50k and a stress free life for that item and in reality I make more profit at the lower price to one customer. Some people are set up and have the logistics to deal with 5,000 customers....I don't and don't intend to any time soon.

cheers

Dave

[Doug Griffith]

One large order also allows larger material buys resulting in lower costs which can be deferred by having terms with suppliers.

[Dave Sheldrake]

Sure does Doug, I do keep a stock of the common materials though...about 30 metric tonnes of the darn stuff :( the differences ordering by the pallet can be as much as 50% less cost!

cheers

Dave