Tips to Starting Your Own Home Woodworking Business
Self-employment as a woodworker provides independence. It enables the unique situation where you are able to create wood products, furniture and cabinets at a pace you are comfortable without anyone looking over your shoulder. You essentially become your own boss.
In this guide you will learn:
- Have you successfully made furniture or wood products before?
- Are you comfortable dealing with clients?
- Are you familiar with the joinery used in woodworking?
- How skilled are you at applying finishes to wood products, furniture and cabinets?
- How long does it take you to make a wood product or create furniture?
- Are you capable of working within deadlines?
- Can you handle business that detracts from woodworking?
If you are tired of the rapidly changing job market and the increasing demand for technology workers, then woodworking provides a degree of technical stability.
The woodworking industry evolves very slowly and unless you are involved in the highly computerized and mechanized CNC end of the market, the woodworking industry is very traditional. There are many types of tools and machinery used in conventional woodworking which date back to a century or more ago, to give you an idea of how relevant any knowledge you gain will be useful in the future.
You will also need to weigh the advantages and disadvantages of becoming a self- employed woodworker in comparison to holding a day job. A day job often provides stability and a regular source of income without the need to worry about the next pay cheque.
What is a good first woodworking project?
To pay homage to those character building years, I have compiled a list of 8 of the easiest woodworking projects for beginners.
- Simple Pallet Shelf.
- Makers Kit Wood Craft.
- Wooden Sofa Sleeve Cup Holder.
- Rustic Candle Holder.
- Address Number Wall Planter.
- Wooden iPad Dock.
- Tiny Wooden USB Drive.
- Floating Wine Bottle Holder.
Of course, we know this is not always true especially in today’s rapidly changing economy and the threat of a downsizing or loss of a job is a reality. Until this happens, however, a day job is a reliable source of income. However, the disadvantage of spending forty hours a week at a day job is dependent on the type of work you do and most importantly, do you enjoy what you are doing?
If you are as many people out there in the workforce that gain little to no satisfaction from your work then you should follow your dream and investigate the idea of becoming a part-time or full-time woodworker.
Being in business for oneself involves more than just woodworking. There are other aspects to a business you need to take into consideration. Other aspects you to concern yourself with aside from woodworking include: accounting, inventory control, equipment and tool maintenance, purchasing, marketing, advertising, and shipping.
These aspects of a business take valuable time away from the core woodworking but are necessary for the business to survive and thrive. You will however learn to manage these other business related tasks with due time and once again revert to woodworking as your primary focus.
These and other questions are the core of any woodworking business and you will need to cope with these issues at one time or another
I haven’t touched on the immense satisfaction derived from the independence and freedom derived from being a self-employed woodworker.
Speaking from personal experience, I can attest that the freedom gained is unparalleled. There is no more need to dress up and commute back and forth to a workplace which perhaps provides little satisfaction but mostly only financial security. Guaranteed jobs have also become a thing of the past. The often reduced and irregular income which is part of being a self-employed woodworker is well worth it in my opinion. You will also need to determine if you can survive as a woodworker at this point in your life however by weighing your monthly costs which include housing, family expenses, etc.
The Different Ways To Start A Woodworking Business
Once you have decided to go into the woodworking business there are a number of different ways to proceed. If you are fortunate enough to have a woodworking shop that you have used as a hobby you can convert it to a woodworking company. If this is not the case you have other options available.
You can start a woodworking business from scratch or you can buy an existing woodworking firm or you can purchase a franchise. All of these are viable options and we will take a look at the pros and cons of each. The one thing to remember is that going into business is not easy no matter which method you chose if it was everyone would do it. Hard work, dedication and sacrifice are all part of the entrepreneurs day-to-day existence. But take it from someone who has done it for himself the rewards far out way the hardships.
Starting a woodworking business from scratch is by far the most difficult but can also be the most rewarding because it is something that has personal stamp on it, something you have built from the ground up. The first thing you need to do and without a doubt the most important is to develop a detailed business plan. The SBA (small business administration) and all the banks that lend for them won’t even consider taking a loan application from someone who has not taken the time to create a proper business plan.
The first thing you need to do in the preparation of your business plan is to analyze yourself. You need to be honest with yourself and list your strengths and weaknesses paying special attention to your business experience. The next four steps work together. You need to choose a product. Are you going to make toys and birdhouses or are you going to produce fine wood furniture.
This goes hand in hand with the next step which is to research your market. You need to research the market so that you can forecast sales revenues which will allow you to build pro forma financial statements. Armed with your market research you can then decide where you should locate your new woodworking business,after picking your site you can then develop a production and marketing plans. You will need to develop an organizational plan so as your woodworking business grows and you start to add employees there will be no confusion when it comes to who reports to who. This may not seem important when you are first starting out but becomes very important as you grow.
Your business plan will also have to include a legal plan, insurance plan,accounting plan, quality management plan and an overall financial plan. By developing all the different steps in your business plan you can come up with an estimate of the financing that will be required to get your woodworking firm up and running. Remember eight out of ten start-ups fail in the first year.
Proper planing helps you avoid a lot of the pitfalls and increases your chances of success.
Buying out an existing woodworking business is the next option. This option also requires that you prepare a business plan so you can make a honest evaluation of the different woodworking businesses you are considering. You are going to want to have your accountant review all financial statements to verify that the businesses you are considering are operating at a profit.
It also gives you an idea of what the woodworking business is worth and what you may be willing to pay for it. There is never any guarantee of success, but the odds are better when buying out an existing business, because a successful woodworking company has proved it can draw customers at a profit, and they have established relationships with bankers and suppliers which can be very valuable. Weather building a woodworking business from scratch or buying an existing woodworking business a good business plan is a road-map to success.
Buying a franchise is the next option we will look at. A franchise is an agreement between the franchisee (buyer) and a franchisor (seller). It normally requires a lump sum payment upfront with a percentage of the monthly revenues paid to the franchisor. For this the franchisee gets a proven business model and help in marketing and advertising, employee management and training, shop design and equipment acquisition, site selection assistance and help with financing. The major drawback to franchising is that you are constrained by the franchisor’s policies, standards and procedures.
in other words, there is a loss of independence that starting a woodworking business from scratch gives you.
The last option is turning your woodworking hobby into a woodworking business. In this case, you have the woodworking tools and the shop already set up.
This saves you a lot of money at start-up a time when money is normally in short supply. You will still need a business plan for all the reasons stated above. There is absolutely no substitute for proper planning, when it comes to being in business.