Starting a Business

[martin.pearson]

Bit of a long story but I will try to keep it short(ish).

I bought a signmaking franchise many years ago which didn't last long due to me having to charge very high prices, after the franchise dumped me I carried on because I still had to pay the equipment & other costs so just kept doing the same thing under a different name & setting my own prices. Kept it going for a while but had to stop when I got to ill to work.

The woodworking came along almost by accident & although I am not well enough to work full time I think I can manage part time & would rather run it as a business rather than a hobby for various reasons.
I can get help & support from People like Help For Heroes & X-Forces but I need to put together a business plan which is something I didnt have to do when I bought the franchise so is something I have never done. I can manage a lot of what is asked for with a business plan but part of it is putting together sales forecasts & I don't really know where to start with that lol, anyone on here actually running a business selling hand turned items? I would imagine things like pens & other hand turned items will probably be quite a small part of what I would like to do but any help would at least get me started.

 

[Penpal]

Go well Martin takes courage from defeat,all the best .....Peter.

 

[wm460]

All the best with your future endeavours.

 

[Phil Dart]

Business plans are usually associated with securing funding, so sales forecasts are a way for the lender, or the donor of a grant, if that's what it is, to reassure themselves that you can either pay it back or that their grant is going to be used wisely. You can't really do a sales forecast though until you've identified where your target market is, how you're going to reach your market, and how you're going to compete with or set yourself apart from anyone else trying to sell into your target market.

If you've already had some thoughts along those lines, I'm happy to give you some support if you want to PM me or give me a call. I don't have a magic wand to waive, but I am in business, and I've been there, done that a few times before.

 

[Lons]

What Phil said Martin.

I've had a couple of small businesse and run much larger ones for others so have some experience and it seems to me your still quite a way off starting your own.

As said, you can't forcast sales or in fact anything else until you identify your potential market, products and competitors. You need to do some serious research and leg work to get that information and it will take time and a lot of effort. One of the biggest issues is trying to use your head and ignore your heart when it comes to those decisions, many people have rose tinted glasses and the dream of earning a living doing something they love but for the vast majority it's a trade off and running your own business is bloody hard work, ( you know that already having had a franchise) and you need long hours and full support of your family.
There may not be a market at all in your part of the world so is there an on line alternative or additional to local. What price levels are common locally on your targetted products, where can you sell them? - Fairs, local shops, friends / family etc. What will your costs be? - true costs including overheads, salary, replacement tool fund, insurance liability, provision for sickness etc.

How you carry out that research and handle the facts will determine 2 things:
1). Whether it's worth trying at all or a dead duck but you might find other ideas to follow during the process.
2). If it is viable you will with the data gained have at least a definite plan of your first steps.

It might be sensible to test out by producing a few, or buying in some of your likely products and testing out before you go in full tilt where you could well end up with a large stock of unsaleable goods.

All that said, there can be a lot of positives and providing you have enough drive, motivation and stamina you can make a decent living though I'm not so sure about just by selling turned items and if that's what you choose to do then I wish you success and hope you can find some nice little niche markets.

regards
Bob

PS. Just a thought. You inferred that the franchised products were overpriced, a very valid point but my experience is that just because something is cheap doesn't mean it will sell and I certainly wouldn't go down the cheap route unless your costs are very low as you're unlikely to sell enough volume to make it work.
Far better imo is to price reaalistically and sell the quality benefits, if you need to reduce prices then offer discounts or sale prices. If your starting price is low you're stuffed as it's hard to increase prices but easy the other way around.
Everyone want's a Rolls Royce for the price of a Mini but in reality just want value for money rather than cheap tat.

 

[Pierre---]

A business plan, for us little craftsmen, is in fact business hopes, but it helps to see how things should go for good business. I think it is quite easy to do.

If you plan to sell through fairs, how many can you attempt in a year? Earning say 400€ each is very optimistic at my place, sometimes it is merely 20. Could be more but then usually I'll have to pay a lot for a stand. See what happens in your area, so it will not be too difficult to evaluate that part of your income, just don't hope to make 2000€ in an unknown country side craft sale.
If you plan to sell through Etsy, look for a shop that sells the same stuff than yours, and see how many sales he makes pro year. That's another part.
If you plan to sell through real shops, be sure they will mainly sell before Xmas, or in summer in a touristic area, and little in between. And they want to earn something too, so it will not be thousands, but it will be again another part.
Add your future Internet site, your neighbors, any idea you may have, and some good luck, some bad luck too and you will have a good idea of an reasonably expected income.

Try to convert this income into a number of things to make and into time needed? It has a cost : kits, wood, machines, electricity, place, internet, car drive, advertising, exhibition material, Etsy costs and more - or less. Subtract and then you have your prospective earnings.

It is quite easy to roughly calculate. It will end up as a good guide.

 

[martin.pearson]

Thanks for the replies, I didn't really give enough detail in my first post, that's what you get for trying to keep it short plus I am not great when it comes to talking about myself anyway.
Yes I have the chance of both a grant & a start up loan (at good interest rate) which is why they require a business plan. Think the reason I am having trouble putting together sales forecasts is because a lot of it seems to be guess work & I am not really a fan of just guessing lol. The research bit is what has me a bit stumped, hand turning will form a very small part if any part at all, it just doesn't seem to pay if you look at the time taken & what you can sell for. Work done on the CNC machine will I hope form the main part of what I do & that causes a problem because there is so much it can do so figuring out where to start is not an easy thing to do.
Although I will produce some items for general sale I expect the majority to be custom made & also personalised.
If you have looked at my facebook page or looked at some of the things I have posted on here it will give you an idea.

I would be quite happy to go back to signmaking if it weren't for my disability & illness. When I started because I have problems with my right leg my insurance company wanted something in writing to say I was still safe to work from a ladder, at the time my GP was happy to provide that so all was good, my insurance company wanted to update their records o asked for another letter, unfortunately have moved a couple of times since I first got this done & the GP I have now won't put anything in writing. This means my public liability insurance won't cover me to work at any height off the ground, they won't even cover me for a step ladder so that pretty much rules out doing any kind of shop or site work unless I sub contract fitting & that can be a complete nightmare from speaking to others.
The other problem is that with my illness I have good & bad days so arranging for a customer to bring their van in at a certain time on a certain day so I can apply livery is a real problem. Some types of work are still OK for me to do, f the customer wants a sign making & is collecting it then I can manufacture it on good days & even if I am having a bad day on the arranged collection day all I have to do is go along to workshop to hand it over. There just isn't really enough of that type of work & to be honest I would rather be doing the other stuff anyway lol

This isn't a lifestyle choice or something I want to do rather than work for someone else. I can't really work for someone else with my illness, even part time. because I get good & bad days I would have to keep phoning in Sick, I have no idea when they are going to happen so can't really plan for them although it would be great if I could lol.
I get a War Pension because I was medically discharged from the Royal Navy, I don't have expensive taste & buy very little. The business doesn't actually have to make any money, just cover most of it's costs but obviously I would be looking to make money lol.
A big part of wanting to run this as a business rather than just calling it a hobby is to prove to myself that I still have some value to society, if it ends up going pear shaped I have asolutely no idea what that will do to my mental health lol

The Grant & a small loan would be really useful, I am in need of a decent table saw & they aren't cheap plus there are a couple of other bits of equipment I could do with to help speed things up a bit. I rent a small workshop but really need a workshop at home, again cost of building isn't that cheap even if I do it myself.

 

[alan morrison]

Martin, I noticed when reading the above that you posted it at 3.36 am so I assume that you could add " trouble sleeping " to your post as well.
Life throws us obstacles and you have been thrown a fair few, but I also noticed that there was no sense of " poor me " and that you have a positive attitude in all this.
I believe that it is this positive attitude that gets us through, so stay strong Martin.
Alan

 

[Lons]

Hi Martin

What Alan said.

As I said, you have to do some serious research to see what you think might sell, look at what is already out their from potential competitors then do the breakdown of what it will cost you in materials, time, marketing sales commision to shops etc.
Once you have that base cost you need to add an element for overheads, time & labour plus a profit so you can invest in the business for future development.

It's not difficult once you have those to buils a simple business plan to enable a grant / loan. As much as the actual content of the plan they want to see that you have done the leg work and have a grasp of what's needed to start a business that has a chance of succeeding. Sorts the genuine applicants from the no idea and no chance crowd. From the content of your posts you are definitely genuine and just need a bit of focus, it's not easy getting the target products and market right which is why I said you'll likely come across other ideas that take you off at a tangent often better than your initial direction.

So, business plan.

Overheads, easy enough to estimate. If from home there is a formula but I calculated a %of power, water, heating, council tax, mobile phone etc.for office then full workshop costs.
Add to that likely cost of stationary etc.

Remember also that you can offset the costs of not only your new equipment ( table saw?) but existing tools, vehicle, computer, printer against tax as long as they are genuinly used for the business.

You need to guestimate and put a target on your sales for the first maybe 3 to 5 years and from that deduct your costs to get some final projections.

Good look with your plans Martin I'm sure you'll make it work. Got a fuzzy head this morning after a late night out so I'm sure I've left out loads of stuff.

Bob

Remember that's all they are and a business plan will always be a work in progress evolving as your business changes it should be reviewed constantly

 

[martin.pearson]

Haha that's the tip of the ice berg Alan, not mentioned the divorce, homeless with nothing or a few other chapters yet !!! What's done is done, can't be changed & I would imagine wallowing in it would just make me worse so don't see the point. Oh & who wants to hear all that Cr*% anyway lol

I have spoken with X-Forces as they seem to do this sort of thing for Veterans, they will help with the research, think that is my biggest problem as there are so many different things that I could produce just with the CNC machine. I am probably going to have to narrow things down a bit for a business plan & consentrate on some of the items that I could produce that will sell for a profit. The fact that I can also personalise just about anything will help but I still need to find those perspective customers. As I said above I am not looking to turn this into a lifestyle business, no empire building for me, just enough to pay for itself & boost what I already get would be enough for me.

 

[Lons]

Good to hear you can get some help Martin.
Being able to personalise is a significant advantage as it gives added value and set you apart hopefully from competitors.

ATB
Bob

 

[alan morrison]

Hope that it all works out for you Martin, and that you find that " unique selling point "
All the very best
Alan

 

[martin.pearson]

Good to hear you can get some help Martin.
Being able to personalise is a significant advantage as it gives added value and set you apart hopefully from competitors.

ATB
Bob

Had an email from a guy at X-Forces asking when the best time to call is so hopefully things will start to move.

I can already personalise with rotary or drag engraved text & graphics on the CNC machine. Purchased a laser engraving module a while ago hich when fitted will give me the option of laser engraving as well. Just need to try & find the time to fit it lol. Plus build a new control box for the other CNC machine I have because that will have a rotary axis allowing me to do turned work as well.