Newbie seeking advise

[Nathan Shaffer]

Greetings All,
Would anyone be willing to give me advise?
I am wanting to start a "hobby business". Meaning that I want to start a small engraving business but I do not think/know that I will meet all the IRS requirements to be considered a business. So I do not have a clue what to do about taxes, any advise?

I cannot decide on what type of machine to get. The Full Spectrum 5th gen hobby laser looks nice due to its $4500 price tag. But, I am concerned about ease of use and overall quality. The next machine I am looking at is the RAYJET 50, current quote is between $8k-$9k. Last is the EPILOG not sure on a ZING 24 or a 18Mini.
Currently have potential customers waiting. They are a home brewer, having bottles personlized, making parts for signs, engraving farewell/retirements plaques, wooden nickels etc. Planning on using alot of the knick-knack things from laserbits.com, plus anything anyone asks to be marked or made.

I do have access to some people that have and can provide training. I have used an Epilog 36EXT.

Questions:
1. Any advise on how to fund a machine?
2. How to deal with taxes for a small venture?
3. Suggestions, pros, cons on different machines?
4. Should the type of rotary attachment be a factor in what machine to get? ease of use, production rates, repeatability, etc

Thank you,
Nathan Shaffer
Vandenberg AFB California

[David Rust]

Nathan,

If you’re starting a " hobby business" then do it as a "Sole Proprietorship". You file your business taxes along with your personal income tax, any business income is considered your personal income. In my opinion it is the least costly and least painful way to have a "hobby business".

As for a machine... there are a lot of great machines out there. You need to do some research, look at reputation and what people are saying about customer support. I think there are some really good used machine deals out there. Just look around and ask lots of questions. Call up a few company reps and ask them questions. I think you will be able to make a smart decision with a little research.

Funding a machine... You can buy it outright, take a personal loan, business loan, or lease a machine. Either way it will cost you a down payment up front... you should probably plan 20%-25% down. Don't forget about the smaller peripherals you'll need to get going, compressor, exhaust fan, ducting, ect... setting it up isn't rocket science, just be smart and follow what the manufacturer recommends and ask lots of questions!

Next you will need to think about your initial operating expenses, if it’s a hobby it is probably in your house so rent won't be a big deal. Don’t forget about electrical power and initial supplies to practice with.

I recommend you start by writing a business plan before you buy, a business plan will help you think the whole process through before you spend your hard earned money. It will make you think about what you are going to make, who your customers will be and also helps you to understand your competition.

It is a really neat business to be in, it lets you be creative, artistic, and often results are amazing!!

Welcome to the club,
Dave

[Nathan Shaffer]

Thank you for the advise!

[Martin Boekers]

Check out a google search for "kickstarter" at least one here at SMC has worked with that.
Also if you become a "contributing member, I believe at $6 a yr Keith Outen has a great
promotion happening that you can win a laser. See the posting on our forum here.

[Roy Nielsen]

Nathan,

I'm in a similar situation of possibly starting some sort of small business.

You should probably investigate limited liability corporation (LLC) as a business option. The costs are fairly small to get established and it can protect you from a liability standpoint. You should look to see if you have some sort of Federal Small Business Administration function in your local area. Here in Oklahoma, for instance, there are regular and free small business tax seminars. I went to one and it drastically helped me figure out the best options for me, should I proceed. There are also more in-depth one-on-one local offerings.

Roy

[Bert Kemp]

FYI I bought a Full Spectrum Laser, the tube went after 100 hrs. They told me that tubes should last 1100 hrs or better. Problem was they couldn't tell me the tube was bad thru support. they jerked me around for 2 months , lots of rude emails from CEO I couldn't get them to make an appointment to check out my machine. Finally they told me to bring it in and they would look at it at their convenience , barring they didn't have to much email to answer or more important customers to look after, or phone calls to answer. In the email from the CEO telling me to bring it in some month from now he also told me he'd fix it for free, but they charged me for the tube. They also told me that when I came they would discus weather they still wanted to support me.
I will say that the day I took my machine in they did work on it right away found the problem was the tube and replaced it. took like 6 hrs. The CEO was not there and the people I dealt with were very understanding and treated me well. It hank them. I'll also say the machine does a nice job when its working.

[Chuck Stone]

FYI I bought a Full Spectrum Laser, the tube went after 100 hrs. They told me that tubes should last 1100 hrs or better. Problem was they couldn't tell me the tube was bad thru support. they jerked me around for 2 months , lots of rude emails from CEO I couldn't get them to make an appointment to check out my machine. Finally they told me to bring it in and they would look at it at their convenience , barring they didn't have to much email to answer or more important customers to look after, or phone calls to answer. In the email from the CEO telling me to bring it in some month from now he also told me he'd fix it for free, but they charged me for the tube. They also told me that when I came they would discus weather they still wanted to support me.
I will say that the day I took my machine in they did work on it right away found the problem was the tube and replaced it. took like 6 hrs. The CEO was not there and the people I dealt with were very understanding and treated me well. It hank them. I'll also say the machine does a nice job when its working.

I would be going through THAT contract with a fine toothed comb! Plus doing screen caps of any promises
they've made online, in email etc.
Treating customers like that is not only a good way to go out of business, it seems like
a good reason to force them out of business!

[Mike Null]

Based on what I've read here and personal knowledge of Full Spectrum experiences by two of my customers I would suggest looking beyond Full Spectrum to other brands. If you want reliability look at the Rayjet (by Trotec), Epilog and ULS machines as they come with a real warranty and real unlimited tech support.

[Bert Kemp]

I would be going through THAT contract with a fine toothed comb! Plus doing screen caps of any promises
they've made online, in email etc.
Treating customers like that is not only a good way to go out of business, it seems like
a good reason to force them out of business!

It really to bad there's not places other then were you bought your machine that will fix them. You either have learn how to fix them yourself, Pay extraordinary shipping fee's to send it to them, and you never know what kind of condition it will be in when FedEx or UPS throws it off the truck in your yard. Or as in my case I drive it back to the factory myself. Its cost less then the cost of shipping, even tho its 300 miles each way, About $100 in gas $45 for a room and 30 or 40bucks for food, plus I get a night out in Vegas. Versus $250 for round trip shipping and the hassle of crating it all up and then praying it comes back in one piece. I think there's a huge business opportunity out there for Laser repair . Some of you young guys should look into that.