making money at woodworking [Archive] - Sawmill Creek Woodworking Community

Ray Schafer

04-08-2008, 4:34 PM

I am trying to develop the skills so that when I retire ... in about 15 years, I can make some extra money doing something that I really enjoy. I would like to benefit from the experience of The Creek to understand where the money is in woodworking. Here are some thoughts that I hope that you will add to:

1. Building and installing cabinets. I find it hard to understand where there is money to be made here, since you can go to any number of cabinet companies and order pre-made cabinets in so large of a variety.

2. Building furniture. Same as above.

3. Building custom -- very high end -- cabinets ... those that cannot be purchased. I don't really understand what this would mean ... again, because of the variety of cabinets available.

4. Building "fine" furniture. How do you find the market and what is fine furniture, and why does it command a price high enough to make money?

OK, so those are my novice thoughts. Can you help me out here?

Bill Wyko

04-08-2008, 4:42 PM

Make money at wood work? Who ever heard of that?:DMake money, buy more tools to make more money so I can buy more tools.:confused:

John Dugo

04-08-2008, 5:05 PM

It's not an easy thing to do Ray. Most woodworkers never break even. I think that you have to come up with something unique, and or be able to market yourself and product so that it will make people perceive value and worth. If you can get your material as cheap as you can, and make the process as efficient as possible, you'll have a good start.

Lee Koepke

04-08-2008, 5:12 PM

Let me preface this by saying woodworking is not my profession....

The way to make money ( with anything you do ) is establish a VALUE for your work. It will be difficult to succeed in a small shop with clients that first and foremost are concerned with price. Finding the right clientele would be the key to say, custom cabinets.

In my house for example, there are not many choices for my TV/Entertainment center, so that would be a custom cabinet / furniture situation.

Mike Henderson

04-08-2008, 5:12 PM

Well, this isn't really an answer to your question, but there's the story of the woodworker who won $3.5 million in the lottery. When asked what he was going to do now, he replied, "I think I'll keep doing woodworking until the money runs out."

Mike

Ray Schafer

04-08-2008, 5:13 PM

Yeah, I have sometimes thought that maybe I could come up with something unique and sell it at craft fairs. I saw a crafts fair last year where someone was selling adirondack chairs and tables, and they were not very well done. I thought that if he could do it with such poor quality, then I could probably do it, too.

Louis Reed

04-08-2008, 5:15 PM

:) A fellow woodworker asked me " What's the difference between a woodworker and a pizza ?" I said I didn't know.

He said a pizza can feed a family of four ! :D

Like the others said " you need sonething unique ."

Louis

Dave Burris

04-08-2008, 5:19 PM

I was a partner in a custom cabinet shop roughly 12 years ago. I started it with a very good friend of mine. We scratched together a small living for the two of us for about 5 years. We never really got ahead and made it what I would consider a success. We sold the shop at a break even price and went our seperate ways. I have since got into the ATM industry and my friend is an engineer for a rather large millwork shop in NM. I dropped of the wood radar up until last year when a friend of mine asked for some help with an entertainment center. With the few tools I had left we threw one together. I looked at it and was somewhat disappointed with my rusty skills, he was estatic.

That is when it occured to me. I have an income that takes care of my needs. Woodworking now has a place in my life again. It gives me a sense of peace and the ability to create. Do I want to make money at it? yes ... Is it worth the potential heartache and ruin my desire to build? For me, No ...

Just something to think about ....

Gene E Miller

04-08-2008, 5:28 PM

Greetings & Salutations,

I am retired and have some of the same thoughts about
making some extra money.

I have built some lawn furniture such as porch swings and
some unique 2 piece lawn chairs that I have been able to
make a bit of profit on.

There was an article recently in one of the woodworking
mags and I would have to go thru mine to fine which on
but it had a formula on how to price your work.

The one key is "what is your time worth or how much do
you want to make in a year.

The formula worked by breaking down your labor to an hourly
rate that would make you "x" number of dollars in a year.

I plugged the numbers in on the Cherry Cedar Chest that I
built for my nephew as a wedding gift and at a modest $15.00/HR
I would need to charge $1800.00 for the chest. Included in that
figure were shop supplies, cost of heat, air, electric and such
along with materials.

I also did some research on the computer and there are some
folks that are hand making ceder chest out of fine woods and
getting as much as $3500 or more.

So when the opportunity came up to price one to my insurance
agent that seen the one I already built I quickly quoted $1800.00.

Well I didn't get that but I almost fell over when he offered $1500.00
so guess what I said I would build it. LOL:D:D

I would not want to go into a full time situation where I would
have to build one right after another but rather be able to
price out a project and work on it at my own pace.

It does give me something to do and keeps me from roaming
the streets at night.

Hope this helps.

Gene

Mitchell Andrus

04-08-2008, 5:29 PM

Ray,

First, you won't be making things out of wood to make money!!!!! You WILL be running a business that sells the stuff you make, to make money. Big difference.

Second, sharpen your elbows... it's crowded out here. Find a niche, attack it with all you've got and be prepared for this: even if you love something you've made that doesn't sell or can't be produced at a profit... scrap it and get on to something else in a hurry. Marry a product or product line that doesn't sell and you'll starve in a very clean shop.

At 40 and I started in woodworking (12 years ago) by sending 20 prototype designs to over 100 brick and mortar shops. I had a profiable business running full time in 6 months. It can still be done today.

In the last 12 years, I've made and offered over 350 designs, many in a few sizes and configurations. My core business consists of only about 150 of those designs at any one time (the rest being failures), and about 50 of those designs sell enough volume to float the boat. Each year I launch about 15-20 new items (fewer every year), and drop about that many off the roster. If you've got only 10 things to offer, stay home.

This year an entire line of Stickley-style inlaid veneers is new (ad in Woodwork magazine at $475.00 a pop)... I've been working on these for over four years and cut them on a $20,000.00 laser. They're selling great, but giving birth isn't for the timid.

If you aren't represented with your own website, you're invisible these days. Plan on spending more time on the website than on prototyping goods to sell. I've got many hundreds of hours invested in my website(s). No kidding here, either learn to get it up and running or pay to have it done for you. I've had one for 10 years, I'm on my third platform and I think I'm about 80% happy with it.

Remember, just because someone has a gee-gaw on his site that doesn't mean he's selling it in any great numbers. Many items on my site sell 1 to 3 units per year.

Go for the gusto.

Having said all that, I've done shows with Debey Zito (back cover of FWW a few years back) in the next boothe and saw her sell a $14,000.00 chair and a $23,000.00 hutch in one afternoon. She doesn't need to ship as much stuff as I do to pay the bills.

Tim Thomas

04-08-2008, 6:09 PM

I am trying to develop the skills so that when I retire ... in about 15 years, I can make some extra money doing something that I really enjoy.

If you are already going to be retired, and all you want to do is make some "extra" money, then I think you can get by with just making small items or whatever interests you. If I am understanding your situation correctly, it sounds more like you want a hobby that winds up not costing you money and maybe even makes some on the side. My grandfather-in-law and his wife did this when they retired. He made small wooden items, his wife painted them, and they sold them at craft fairs. They didn't make the kind of money that you could count on for budgeting, but they made enough to pay for their supplies, the cost of the trips to the craft shows (gas, meals, rooms, etc.) and a little bit left over. I'm sure that if you divided up their "profits" by the amount of time that they spent making the items, that they were getting very little in monetary compensation, but for them it was more about the friends they made and all the fun they had working together. It was a hobby that paid for itself and provided a lot of fun experiences that made their lives richer. Hard to really put a price on that.

If I misread your original post and you are actually looking to get into woodworking as a serious source of income, umm... well... I have nothing to offer there. Good luck. :D

jud dinsmore

04-08-2008, 6:24 PM

ray,

first, some quick responses -

1. labor services (installing cabinets) all depends on your location. there is a consistant lack of "good" people that know how to work with their hands and are willing to do so. you don't have to be a master craftsman but if you can do simple things like return phone calls and show up when you schedule yourself, you'll be in high demand. i occassionally install cabinets for one kitchen designer. she's constantly turning over sub cabinet installers because guys don't show (or do unacceptable work - not just bad, but putting-in-a-cabinet-upside-down bad). my expenses are minimum - the business is out of my house (no shop) and there just aren't many overhead expenses to keep up with. if i were to do this full-time, and assuming some level of constant work, i could probably make $60k-$80k/yr. with that said, here are the two biggest obsticles as an installer - 1. i install solo and it just wears your body out. i guess i'm still young (33) but i do come home tired and sore. i'm very aware of being dependent on my body to make money. i'd much rather be dependent on my mind. 2. problem #2 is i'm not making any money when i'm not working. this is different from my semi-former job as a general contractor. i don't need to work as much when the plumbers are there as i do when i'm running trim. this doesn't seem to matter as i'm getting paid for the build, regardless of how much physical labor i provide to get the job done. as an installer, all of my sick and vacation days would be unpaid.

i don't think opening up a kitchen cabinet shop is a good idea in today's market. this market is way overcrowded and you and your competition's first move will be to cut the price. i'm sure it is possible to market yourself as high end, but the deck is stacked against you.

2. furniture - i think it has been over-discussed that most individuals aren't willing to shell out the bucks for quality furniture. there are people willing (and wanting) to pay for your services but i think this would be a hard market to break into without personal connections and advanced marketing.

3. & 4. custom wood products - i think this is the best choice. you'd be skilled enough to build any and everything. entertainment centers and custom built-ins will probably be cash cows.

i'm just starting a small commercial woodworking shop and i'm specializing in nothing. i'm going to offer up a bunch of different services and go from there. this is a business first and foremost, so i'll be specializing in things that the market demands and can satisfy my financial goals. i've got a serious marketing budget and am committed to it without hesitation. i'm in a fortunate position given that i can use my personal savings to start (and maintain for a limited period of time) this business. you cannot go bankrupt using your own money - you just call it quits. i think i'm as prepared as i will ever be so i'm taking the plunge.

as a side note, and perhaps of serious importance, while i enjoy woodworking, i'm entering this market for financial improvement more than quality of life. not to say that i am not going to enjoy woodworking once i'm on the clock, but i see my business filling a void in our local market, so it is partial for quality of life and partial a business decision. like others have suggested, i plan on losing some of the joy of the hobby when i have to make a living at it.

as another side note, i installed a gate and doggie door yesterday and today. i'll take any job that turns a profit.

good luck,

jud

David DeCristoforo

04-08-2008, 6:44 PM

This is a tough question. But after a really long time "in the business, I may have something to offer. First of all, you need to ask yourself if you want to be a woodworker or a businessman whose company does woodwork. If you want to do woodwork, stay very small. Just you and maybe one other guy. Any more than that and, like others have pointed out, you will be spending much more time supervising, managing and "administering" that you will spend doing any actual woodwork.

Another thing to consider is your "target" market. With just you and one other guy, there is no way you are going to compete with factory mass producers. And unless you have a very large bankroll, you are not going to be in a position to set up your own factory. So you need offer your customers something that the big guys cannot offer. And you need to find customers who can appreciate the difference and are willing to pay for it.

When I had a shop with ten to twelve employees, I made very little money. We survived but my employees had it much better than I did. After I "downsized" and went back to working my myself and then with my son, I did much better, had a much lower stress level and enjoyed the work much more. And of course, I actually did woodwork!

You absolutely must be able to design and build very high quality pieces that will appeal to people who can and will spend the money if they can justify it. If your work looks just like what they can buy anywhere else for half the price, why would they pay you double? Your "manufacturing methods" will not be a factor. Most people don't care how a dovetail is cut. But they will care if you are offering them something that they cannot get elsewhere.

As to where to sell your work, "craft fairs" are a good place to start if you have small items that are easily transported. The thing about these fairs is that people often see the same stuff at every one. Every once in a while something really unique will appear and that item will sell "like hot cakes". Then others will start to make them too and after a while, they will become just another craft fair "staple". By then, of course, you will have come up with something entirely new, thereby remaining ahead of the pack.

For marketing larger pieces, look for crafts "co-ops". There are often like "stationary" craft fairs and can accommodate larger works. Also, if there are any "design centers" near by, start taking a day a month and visit them with your portfolio. Designers can be PITA to work with but they can also be the source of a lot of work, love (for the most part) being able to say "I have this guy who just does the best work..." and can be your "entree" into the right circles.

It ain't easy but it can be done. And here's another thought for you. As things get tighter economically, things can change very quickly and we may soon see an "about face" in this whole "world market" thing. If fuel costs continue to rise (as it seems like they will) along with the cost of everything else including "foreign" labor, it's very likely that we will see a "leveling of the playing field" to a much greater extent that we now have and that's going to make "local sourcing" much more attractive.

DD

Ed Gerken

04-08-2008, 7:11 PM

Hi Ray,

I've thought on this subject awhile and touched toe to water once or twice. But then, every hobby I have, it seems, I like to dream (or scheme) how I could make money at it.

When we started our fossil business 14 years ago for my wife's income and built an addition to our home to accomodate it, we didn't know if it would sail or not. We just figured we'd turn it into a woodshop if fossil preparation failed and try that avenue. Turns out I quit my job and the fossil business now supports the two of us, so we never took the next leap. Still, I'm always thinking of the future and hatching new schemes.

In your case, you should begin now with plans for what you hope the future business might cost to startup and how much you hope to earn. Obviously, it takes a "name" to fetch the big bucks for single pieces. That takes years of experience, reaching a market, gaining word-of-mouth, all those things and more. The sooner you start with any plan and get your work out there, the better set you will be when your retirement date arrives.

It may prove prudent to shop for some tools and establish your shop now, paying as you go, even if you don't go straight to working with wood items for sale. Often friends who see your work might comment or ask to commission some items. Over time, this can expand till the income is greater and you'll get an idea beforehand if it's a worthwhile endeavor.

If your retirement income might be marginal, you'll appreciate having some of the costs already absorbed during your final working years. And you won't be starting entirely from scratch later with higher needs and expectations. Tools probably won't be be cheaper 15 years hence, another consideration.

There's a million wood items that are not "furniture." There's things that set on the floor, and then there's things to place on top of them. Knick knacks, wall hangings, boxes, shelves, carvings, clocks, Christmas and seasonal items, you name it. Outside a home, there's yard art and lawn furniture, birdhouses, whirligigs, utility items, even small structures such as storage sheds and what-have-you.

Niche or unique items, such as dollhouse furniture, model railroading structures, restoration of old radio cabinets and other vintage wood items.

Even if you start with minimal effort and time, you can still get your feet wet and try many things while you are not as worried about achieving instant profit.

Consider taxes too. If you begin a "business" now that does not turn a profit in 4 years, the IRS may disallow many deductions. Perhaps keep cost records and take some tool expenses as a deductible later to help offset the presumed greater profits once you are established. I'd get further advice on this issue. If you end up being really successful, it may also impact your Social Security or other retirement earnings.

Whatever item is really hot now, in 15 years it may not be. Be prepared to shift gears and re-aim your sights as time goes on.

Good luck and I hope it's a wonderful time for you!
-Ed

Stephen Edwards

04-08-2008, 7:12 PM

For whatever it's worth, I'm with David on this one. In order to make money, as a small shop or one person operation, with woodworking you MUST offer something unique and of value and find the market that's willing to pay for it. Since you're hoping to do this after retirement, what the heck, don't be afraid to ask for the high price for your work if it's indeed unique.

For myself and developing my woodworking business as as a sideline business, it's as much about selling the image of yourself as it is the pieces that you make! There are many woodworkers much more skilled than I am but who don't get anywhere near the price for their work that I do. I'm not bragging, just explaining that you have to sell yourself as a unique craftsman to go along with your unique work. And of course, tapping into that market that can afford to layout the bucks for whatever it is that you want to do.

Forget competing with the big boys. Do your own thing, put your heart into it and you'll find a way to do what you want to do.

Ray Schafer

04-08-2008, 7:26 PM

Just for clarity on my particular desires -- I am not looking to make a living, just make some money. If I could make about $10,000 to $20,000 a year in profit (in today's dollars), that would give me some walking around money.

Terry Teadtke

04-08-2008, 7:28 PM

And a discussion I have thought seriously about over the past 18 months or so. People are making money woodworking. Not a lot of people mind you but those that build something unique for a targeted market do make money. I know this because I know the people making money in the business. Now if you’re planning on making bird houses, wishing wells out of 2 x 4’s, and other assorted pieces like a bazillion other hobbyist’s do, you’re swimming upstream I my opinion. If you’re thinking about building cabinets to compete with the big box stores you’re going to go out of business in a heartbeat. One needs to think about the upper end of the market.

I don’t know about your Real Estate market but in my area many good cabinet makers have made a very good living over the past decade making high end cabinets for people redoing older homes. I’ve seen kitchens with furniture quality cabinetry homeowners don’t blink an eye in spending up to $100 k for. Unfortunately since the Real Estate down turn a lot of the custom cabinetry shops have gone out of business or have downsized considerably because they were unable to adapt to the changing market or are unable to branch out into other areas.

What one needs to do is create unique product and market that product to a section of the population that is looking for such a product. The higher the average household income the less these people are affected by a downturn in the economy which is already happening. And it costs money to market your products so be ready for that.

As I mentioned above and without going into too much detail, I’ve given this subject a great deal of thought and have decided to take the plunge opening a custom woodworking shop by the end of the year. I’ve spent the last several months creating, designing, and engineering a line of furniture that’s a mix of traditional styles. I have also targeted my market and have a marketing program ready to go as soon as I’m ready.

So far to date I figure it’s going to cost somewhere in the neighborhood of $35,000 to set up a complete one man woodworking shop with better than average equipment, I need a space of 1000-1500 square feet of shop area, and it will take about a year to build up any inventory to actually market. I don’t plan on selling a single item during this time; I will be just spending money on material and producing inventory. When I do have inventory ready to go I will then consider a combination workshop and showroom located near a good part of my customer base. Approximately 3 months before I’m ready to market my products I will have a web site on line and start additional advertising about a month before I’m ready.

I figure it’s going to take approximately 2 ½ to 3 years before I break even with my initial material and equipment investment before I start seeing any profit. By then I should have a solid customer base and be somewhat self-sufficient. I may also go bust and I’m ready for that as well but one never knows unless one tries.

Terry

Grant Vanbokklen

04-08-2008, 7:30 PM

What about custom chair makers. I've seen a few sites that look nice. Not sure if they are making money at it though. Are they? And if so, who are they.

Look at who is making money for good examples.

Karl Brogger

04-08-2008, 7:59 PM

I'm an idiot. I started off on my own just as the housing market around here was take the long trip down the xxxxpipe. I'm going to brag, I'm really fricken good at what I do. That isn't enough though. You need to have a niche and establish yourself. Getting a name is the hardest thing you can do. I'm five years in and people are just starting to know. The first year I was on my own I lost money. The second year I lost money. The third year I was a little ahead and hired my first employee. The fourth year would've been good, but I spent about another $25k on equipment. It's a good investment but I could've used the cash for fun things like eating/sleeping indoors.:) So far year five has sucked majorly. There is no work to be had by anyone in the area. Up to today I've done only two jobs of any size, both of which were still pretty small and we've only scraped up $17k worth of business, and I was hoping to break $200k this year (an almost 60% increase from last year). We have a severe saturation of small shops around also, which doesn't make anything easier.

If you're planning on doing it for just some extra cash my advice would be to get a part time job at a cabinet shop. I'm 27 years old and from working in the trades the last ten years, (plus some of the sports I have taken up in the past), my body is about shot. I dread delivery and install days. Especially on big jobs where I may fill my 16' enclosed trailer 2-3 times to get the cabinets there.

I went into this trying to make more money, not because I enjoy it. In fact I'm getting to the point now that I flat out hate it. I recently was offered a job from a builder that I used to work for to run their cabinet and millwork shop. I may take them up on it because I'm living in borderline poverty now. But, if you aren't counting on the income and you don't NEED it then I say go for it. Just don't spend too much money.

I've come to the conclusion that if a business, regardless of what it does, isn't growing it is dying.

Another thing I forgot to add. Quality has NOTHING to do with how much you pay for cabinets/furniture. I've found the more you charge the more people think they are getting. Granted I don't build crap and I don't think I charge too little or too much but what people really want is percieved value. The first thing I do when I do to a house for a bar or an entertainment center is look at what the people drive. If they have a decent house, but have a aged mini-van, and a rusty corolla then I know they aren't interested in what they want people to think of them. On the other hand if they have a Lexus and a BMW SUV chances are they want people to think they're important and wealthy, which most of the time they're way over their heads in debt. They are the ones who WANT to tell their friends they paid $20k for a bar or entertainment center.

J. Z. Guest

04-08-2008, 8:39 PM

I don't think it is a good plan to put yourself under that kind of stress when you're retired.

To me, the better plan is to work part-time at a Woodcraft or Rockler, and spend the rest of the time doing woodworking.

This will make you break even with your woodworking expenses. You'll still buy the stuff, but you'll just spend your Rockler paycheck at Rockler, and still have your Social Security (if we still have it) and retirement for day-to-day stuff.

If you are REALLY serious about this, my suggestion is to make small, inexpensive stuff in bulk, like the wine balancers thingies and clock/picture frame thingies and sell them on ebay. But then, you're doing repetetive stuff and it isn't fun any more. It has become W-O-R-K, a four-letter word.

Make templates for everything you do, so that you can go back and crank them out with a jigsaw and pattern bit in your router.

For an answer on how to make money in kitchen cabinetry, you should get a quote to redo your own kitchen, then price out the materials to make your own cabinets. You'll notice there's at least a $5k difference between the materials cost and the cost of paying a kitchen cabinet company. I recommend the book by Danny Proulx on kitchen cabinets. He seemed to make everything out of melamine except face frames. He said it didn't pay for him to spend time making his own doors. He seemed to become efficient at every step of the process, using modern hardware to save himself from stupid, time-consuming tasks. (for example, using adjustable cabinet legs instead of shimming cabinet bottoms to make them level & even)

So I guess my answer is that the only way to make money is to pick a specialty and get very good at it. Preferably a niche that hasn't been filled yet.

You also have to take into account that you're going to be 15 years older. Your body will get tired sooner. You'll be weaker. You might have some health problems that slow you down. Kind of depressing, but worth considering if you're going to bank on it. ;)

Bill Wyko

04-08-2008, 8:58 PM

I will say that I made 3500.00 bucks on 3 turnings at my first art show. But the price of the tools it took to make them is much, much more.:confused:

Craig Kershaw

04-08-2008, 10:16 PM

I suspect my bosses comment about how to make a small fortune in the trucking business might hold true for woodworking - start with a large one.

Peter Quadarella

04-08-2008, 10:44 PM

Here's a thought - custom doors. I can't find a decent custom interior door maker in all of Charlotte. And no one I know knows one. I'm about to the point of making one myself, but I want it to be nice ;).

Dennis Montgomery

04-08-2008, 11:27 PM

Ray, I have been a full time woodworker for a little better than 6 years. I spent 28 years in the telecommunications field and just walked away one day and decided to do this. I did not retire, I just changed careers. I had no prior training, just the desire. I have run about $175,000 in sales each year for the past three years as a one man shop, building cabinets, custom casework, and custom closets. Yes, you can make money in woodworking. Here are some thoughts.

I love building custom stuff in my shop, but at 52, I’m finding it more physically exhausting to load stuff in my trailer and go carry it up two or three flights of stairs to install in a customer’s home, and I am in excellent health. You may want to seriously consider this at retirement. Cabinets are easy to build, but installation can be a b**ch.

You are in an enviable position right now. You have the time to slowly invest in good quality tools and develop the products you want to market before retirement. I have a friend that did this same thing. He bought a unisaw, 15” planer, drum sander, routers, lathe, etc., over time while he was working a “regular” job. He got interested in and started building bank boxes using the old post office box doors. Over the years he bought a 6 x 10 enclosed trailer and started hitting craft shows. It took a few years of trial and error to find the right shows where people would actual buy his products, but now he does around $4000 per weekend and only does a few shows each year. He retired a couple of years ago and builds 400 to 500 boxes during the winter and goes to the shows during the summer.

Look at Fine Woodworking magazine for examples of fine furniture. If you want to build fine furniture and get paid appropriately for it, I suggest building some and showing it to interior designers. My biggest single sales come through interior designers. It’s hard to hook up with them, but once you enter the inner circle, it comes with great benefits. Their customers have the financial means and will buy your product if their designer tells them to. Sometimes the designer contracts directly with me on behalf of the customer.

The point is, you have the time to fund your tools, at your pace, develop product(s) and also develop a sales channel whether its craft shows, retail stores, or a loyal following of fanatical customers.

One thing I have found is the longer I am in business, the easier it gets because of the repeat business of my large customer base. My business is down right now because of the economy, but I’m still doing enough to pay the bills and feed the family because of repeat business.

Put a 15 year plan in place and move out…..

C Scott McDonald

04-08-2008, 11:43 PM

Bob Feeser

04-09-2008, 12:25 AM

I come across this topic from time to time, and there are those, including Dave who can advise you better than I. But I did go into the business for a short while. Made wainscoting for a bathroom in an upscale home, did a pair of oak doors, and some oak steps. The thing I was up against, was that I had to spend so much time designing, and everything I was building was a prototype. Also on individual projects is was:
Visiting the sawmill using the same amount of time, and fuel, whether I was doing a little project, or a big one, or better yet, several of the same project.
Setting up different router tables to get the registration perfect between all of the bits. e.g. cabinet doors.
Setting up for each stage, including sanding, refinishing, glue ups, etc.The list goes on. With all of the prototype procedures with making a custom piece on every shot, I wound up making less money then I wanted to. I can see high end quality pieces, known by those who will pay for the quality, being an interesting way to go, but consider this.
If you look at the big boys, Ethan Allen, Wood Mode Custom Cabinetry etc. They are not really custom anything. They mass produce pieces. Why? Because of the economics of it. This country went through an industrial revolution, including Henry Ford, when people were taking mass production methods, and applying it to the trades that used to be all custom made, and very expensively.
So let's say you are making a line of entertainment centers. You design up a couple of models. Gain the advantage of perfecting that model with each build. You offer it in oak, walnut, or cherry and when you get several orders for the same model, you make them all at once. You save time on buying the materials, on design, on setting up the tools, on setting up for each stage of the procedure etc. Everything becomes economized, while still allowing you to do custom level work. If you look at some of the aforementioned manufacturers pieces, they are putting out a semi mass production piece, with a hand made feel to it. (More solid woods, and final stage finishing including ultra fine steel wool the cured last coat, and apply wax, for a hand rubbed feel. You also want a fancy name like to give it some style. This is not bull, or deceiving anybody, this is providing people with a quality product, hopefully being skilled enough in the art of marketing that you are getting a good price for it, and utilizing mass production to make it profitable, and worth your while. It is not unusualy to get $3500 for an entertainment center in three sections. If you got only 4 orders per month, and got used to building the same model, you could knock them out in about 2 weeks, and still have time to enjoy life.
As was mentioned earlier in the post, carrying heavy boards, or cabinets up and down steps, when you get into the more mature years is not exactly what you aspire to. I spent my youth building a body shop for 20 years and did all of that. Wound up with 11 employees, and did a lot of high end work. And like someone else posted, downsizing, getting involved yourself, instead of having to watch a lot of others is more profitable and less risk.
These are my thoughts. There is a lot of great information posted in this thread from others more experienced in this biz then myself, and I am half tempted to print it out and keep it for reference.

Jack Clay

04-09-2008, 7:56 AM

I have got a chance to make projects for a local store that sells primitive items. I have never had a business so I am wondering how all of you do taxes IE tax numbers and income taxes. Do you get help with that part or do you keep track of it yourself. How much work is it to keep track of everything for taxies? This would be a side business with no intention of replacing my job.

Mitchell Andrus

04-09-2008, 8:18 AM

Schedule C

Dave Burris

04-09-2008, 9:23 AM

Actually I work for First Data, the former Core Data, so I have to support all of them. Keep me in your prayers, my sanity is slipping fast!!

Ben Rafael

04-09-2008, 10:21 AM

If you want to make money at woodworking you need to make art pieces, not crafts. Work to get your work in to art shows.
I've done several craft shows and my only comment about them are that the people there who are selling art pieces sell nothing because it is the wrong market, people coming to craft shows rarely spend serious money. The people who are selling crafts are pricing their items too low, IMO they are selling them at cost. The only people making money at craft shows are the ones who are selling imported asian garbage.
My advice, and I will not be offended if you dont take it, is to take your time and make fewer but high quality art pieces. Check out some art shows and galleries to get an idea about pricing and placement. Look at the artists and talk to them, you will find that many are not artists and have just relabled imported work hoping to make a killing(avoid those shows). Some shows will want to judge your work before allowing you to present, those are the better shows.
And most of all , Enjoy.

Jason Scott

04-09-2008, 11:22 AM

Some good answers here and I'll chime in for you. I am a small business owner, not woodworking, but I own a design company. There is one BIG thing that usually separates the success and failures IMO, and that is overhead/expenses starting out. To explain, when I started my company it was nothing more than me and a computer and software, very low overhead. My father has a concrete company in a warehouse in a good end of town, and I was fortunate enough to put my desk in there when I needed to meet clients, etc. So I still kept my overhead low. He is retired, runs the business for fun, and the warehouse is paid for, so he has no need for me to pay rent or anything, and I am only out there every once an a while meeting a client. Point is, lets take a competitor that has employees, a big office with a huge rent payment, and 10X the equipment I do, well he may make more gross income, but HE HAS TOO because of the overhead. Guess what I am getting at, is the less overhead you have the more chance you have to be successful. This will be something you do for fun, so as long as you do not run out, buy a building, stock it with 100,000 dollars of the best stuff, I think you will make enough (if your good) to at a minimum break even and get all future tool purchases out of it, and at a maximum a good retirement income. So I guess the key is, if you don't "have" to make money to live, then just about anything you make over the wood you use for a customer is profit, b/c all your stuff is paid for, so just have fun and don't get in over your head. Most of the huge successful companies started out in a basement or a garage and only after they had an influx of customers did they grow. That is why so many resturaunts go under, before they are even open they are a fortune in debt just to be able to get started. Sorry for the rambling but I really believe that is the secret of anything you do for money yourself being successful and not stressful. Good Luck!

jim oakes

04-09-2008, 1:29 PM

So much good info here.
I'm a retired cabinetmaker. I made a decent living with my own shop, but it was hard work. I paid (and still pay) my own health insurance and of course set up my own retirement plan( no employer matching 401K).
I have a decent size shop next to my dream retirement home. I made all the furniture and millwork for my house. I'd like to make a few pieces to sell, but insurance is a big issue for me. Once you sell even $1 in product you need commercial liability. If you have assets you put them all at risk in todays sue happy world. If someone visits my shop now my homeowners covers them if they are hurt on my property because I don't sell anything.

So I would say first thing keep it simple. Find out what insurance would cost for a part-time woodworking business. It might cost $2000 or more a year. Be sure your homeowners won't be cancelled if your shop is next to your house. If you have one customer who wants a $2000 table your insurance cost for the year is paid (less labor, materials and overhead). Then you can go ahead and make money. Be sure to add up extra utilities and other costs. Will you have to buy new machines?

In my opinion it would be a HUGE gamble to buy a lot of machines, stock,and lease or buy a shop before you have profits from the actual woodworking.

Start small, test the waters, if you can pay your expenses and enjoy the work GO FOR IT!

Ben Rafael

04-09-2008, 2:45 PM

Another way to separate liability from your personal life to your business is by creating an LLC for your business. It costs anywhere from $50 to over $1000 per year depending on what state you live. In normal states(not california) it is inexpensive, and should be done even if you buy insurance.

Bob C Thomas

04-09-2008, 10:09 PM

Without any doubt this is the very best Forum thread I've ever seen on this subject.

While I'm in Australia everything said that has been said here applies equally in Australia.
Its very interesting that everyone has been right in their comments.

I'll add some other comments,

To make $10,000 a year you are setting up a business.
The most important part about a business is selling your products.

I considered setting up a small woodworking school as the market potential is enormous regardless of the skill level you aim at, newby, intermediate, craftsman or master. And I cannot see competition from asia, how can you pack a school into a container and ship it.?

The market comprises 2 important sectors,
Babyboomers who are starting even now to consider retirement hobbies and activities.
Women Woodies. It is surprising how many women would love to learn woodwork.

So this is another suggestion that I'm sure would work in the US and Oz for any reasonably motivated woodie.

J. Z. Guest

04-10-2008, 9:45 AM

Ray,

You might consider posting a thread inquiring what are the "money-makers" for folks who sell their work.

Granted, the professional cabinet guys will say cabinets, but you will be able to home in on the stuff that is realistic for you.

-Jeremy

regis helaine

04-10-2008, 11:01 AM

Not sure that having pros describe what they sell will help. It might even be counter productive.

As said before a wood company is first and foremost a company. The goal is not to discover what the others sell but what your market will buy.

Will Blick

04-10-2008, 2:03 PM

Schedule C

Mitch, I finally checked out your web site..... all I can say is.... YOU HAVE A LOT OF TALENT, AND A LOT OF ENERGY!

Not sure if you have pioneered selling period pieces on the internet, but you sure have done it well. Is there many competitors doing this, or are you blazing the trail? Gosh, that is a LOT of work....

I think your approach is the wave of the future for niche ww's. Craft shows require too much travel and expenses. Bricks n Mortar stores have huge overhead and limited exposure. A niche line of ww products that can be easily shipped really does represent an oppt. that was not available to ww's in the pre-internet era. But as you suggest, learning the internet / web design, is one of the new business skills you must master, or if you have enough bankroll, pay someone... I was quite impressed by your web site. Its nice to see you can get fair prices for your work..

Of course, none of this applies to cabinet makers or built-in pieces..... this field will not change much, other than..... today, IMO, the key is installation, as in this modern era, you can find factories to buy your doors, drawer fronts, and even CNC shops to cut your carcasses. If I was to start a high end cabinet business today (hell there is no low-end market after the imports have saturated the market), I would perfect my ability to use the latest in 3d cabinet design software to properly design / sell a job. Then send the drawings to the big houses to buy the drawers boxes, drawer fronts, carcasses, etc. At most, I would have an assembly area...

My point is.... today, success in the high end market requires a new skill set.... these huge plants with automated machinery is no match for the small shop today. The key is selling and proper implementation of what was sold.... sorry for the ramble...

Will Blick

04-10-2008, 2:26 PM

Dennis, one heck of a post! thanks for sharing....

I too find it ironic, how as we age, we all dream up these ww businesses (mainly in the construction trade) and somehow we dismiss how physically demanding all this work is. As Dennis mentioned, I too continually underestimate how much lifting, I do, bending, torquing my back in undesirable positions, etc. etc.

I was glad to read a previous poster mentioned he is 27 and feels his body is falling apart. My heads-up to him is.... multiply those aches and pains by 5x if you want an estimate how 50 will feel. There is a few exceptions to the rule, those who appear like superman, as their body has healed well through the years and somehow they have rejected any arthritis genes which seems to attack the rest of us. Also, excessive sports in your youth will almost always come back and haunt you later in life. I am finally starting to come to grips with this.... those were fun years, but sheeeesh....

Anyway, its nice to hear you are turning a profit, and maybe getting some young guns to do the heavy lifting is what you need now :-)

With the bleak outlook on new construction in most areas of the country, this is a risky times to enter into such fields.... reality sucks...

Sam Yerardi

04-10-2008, 2:31 PM

Ray,

A lot of good points and comments. I have some comments and please keep in mind I'm not trying to discourage you. I'd like to add that I think to some extent how much you make (or can charge for your work) will depend on where you live, the value and demand for what you are doing, finding a niche market, etc. Items of an artistic nature tend to command higher prices than utilitarian woodwork. Others will probably diagree with me but I think on average, cabinetwork (kitchens & bath) tend to be more lucrative in terms on making money than furniture, especially fine furniture. People are more willing to pay good money for cabinetry than they are willing to pay for what you will need to charge for furniture. The catch is to PRODUCE cabinetry at a rate that is profitable. Fine furniture is even more difficult than just building furniture, in that your clientel is a much smaller group than the average furniture buyer. I would venture to say that few in the furniture making business make a 'killing' at it unless your someone like Tage Frid or Sam Maloof, and even those guys on average probably aren't making what you think they are from building furniture alone.

Having said all of that, I have the same game plan as you. But I only want to sell if I can, and just enjoy doing woodwork. Myself, I'm afraid if it became a business I would soon lose the love for this type of work. Maybe not, but a lot of the fun would be gone I think. My vision is colored by the experiences I've had making and trying to sell fine furniture in my area. It is extremely difficult to find customers that will pay what you need to charge. For example, I might spend 200 hours (or more) on a Queen Anne table. If I need to charge $30 an hour to cover my expenses and make some profit, how easy is it to find someone to pay me $6000 when they can get something that looks close to it from the local furniture store for a tenth of that (or less)? I can try to sell the quality, but hey, we're still talking $6000.

So in the end result, at least for me, I make fine furniture because I LOVE IT. I met a guy the other day at a local SAPFM meeting. An elderly gentleman who did absolutely beautiful, accurate, and historically correct work in period furniture. It was obvious his work could command top dollar anywhere. He told us he's never sold one piece of furniture in his entire life. He makes it all for his family. Not by choice, but I'm doing the same thing. And it is all because of love of furniture building, not for the money.

David Giles

04-10-2008, 4:27 PM

Ray, I've been self employed for many years and would offer a little different, but general, perspective.

The top 1% of any skill set can make a good living whether it be woodworking, flute playing, painting or being an economist. But if you aren't already in that 1% of woodworkers by now, you probably won't be at retirement either. That's the bad news.

The good news is that if you can be in the top 25% in TWO skill sets, then you can make a decent living using both at the same time. The more "well known" woodworkers aren't the best, but they're "pretty good" and they are "pretty good" writers as well. So they make a living writing about woodworking. Or making WW plans (WW and drafting). Or building an online database of every WW article published and selling access for $10/yr (WW and web design). Norm isn't in the top 1% of woodworkers, but he is the best known TV personality in our little club.

I know an average talented artist that only paints birds on the seashore and makes a living. Another paints scenes with razor blades. A third friend is a photographer and pilot. I kid you not, he makes a living by shooting aerial photographs of graveyards. I'm an okay engineer and an okay salesman, but there aren't many folks that do both "pretty well". So develop multiple talents to a reasonably high level.

Being "pretty good" at two things is often enough to make you unique. To make money, find a niche and work it hard.

And you have to decide if you are in it to make money or to have fun woodworking because you can't always do both.

Per Swenson

04-10-2008, 5:12 PM

Jeez,

I started reading all of of the lengthy replies and well,

I guess I missed it, started scanning.

So... You only need three things.

Reputation

Reputation

and Reputation.

and not just with your Mom and Kids.

You need to make people need you, or think they need you.

So, the true skills you work on are people skills and the subtle art

of self promotion.

Frankly, the same way you succeed in any self employed Business.

Per

Larry Browning

04-10-2008, 6:24 PM

Ray,
A couple of years ago I visited fellow Creeker Ian Barley in England. He has a 1 man shop and all he makes is Adirondack chairs. He told me that what he does is cut out the parts all winter long and then assembles during the spring and summer. He hires a couple of college kids to help assemble them. He sell mostly from a web site. He told me that he had also sold quite a few to one of the cruise lines.
I think the thing I took away from my visit was that you need to find one or two designs that sell well, concentrate on those, constantly improve on your manufacturing processes so that you can produce as much as possible while improving your quality at the same time. He has been able to establish a name for himself by providing a high quality product at a reasonable price.
Now, the only thing I see wrong with this is that it looks a whole lot like work to me. If I am going to retire, I want to do something that is a little more relaxing.

Sam Yerardi

04-10-2008, 6:54 PM

I would also like to add - GO FOR IT! You will get as many horror stories as success stories. Even the most successful woodworker's advice or cautions won't applying to everyone. You may find you are immensley successful even at part-time. You might be in the right area at the right time. There's simply no way for anyone to gauge that. Another area that can be very profitable is instrument-making such as violin, mandolin, and dulcimer. You just have to jump out there and try something and see what works. Do some research up front, see what's not being done in your area, see if that's something you want to try and then GO FOR IT. You may find yourself ending up making something you hadn't thought of, but discovered it because you were out there trying something else.

Dennis Montgomery

04-11-2008, 11:35 PM

I know a few people who make a good living doing small products, but they do it mostly wholesale at a high volume. It takes a lot of time and salesmanship to develop this type of model. That's the reason I think it could be a good (semi) retirement venture.

Custom casework is very lucrative because consumers don't have a reference point for pricing. The average person has an idea what is a reasonable price (in their mind) for a coffee table or bed is because they are bombarded with furniture flyers in the newspaper. But they can't go to a store and see 10 foot tall built-in bookcases that fit their unique wall space. My core business is custom closets, with a lot of interesting custom projects thown in. Sure, you can go to Lowes or HD and buy the stuff and do it yourself for a fraction of what I charge, but those are not my customers. My customer is the person who can afford my product, doesn't have do it yourself skills, and doesn't have the time or interest to deal with it themselves.

So it works for me. I am no different from anyone else. I would prefer to build humidors, jewelry boxes, clocks, etc in my shop all day and ship the product to the customer for a handsome proffit. But I haven't figured out how to do this and feed the family yet. I think it's part luck and a lot of perseverance.