How to Set Up a Woodworking Business
If you truly think about it, why would you want to open a woodworking business? What are your advantages over an incorporated company or an individual owner? The fact of the matter is when you are running a business you need to eat the cost of materials and you can’t just say that you will cover the difference.
So, where does this leave you as a contractor? Well, you will need to table up your materials and you will probably need vehicles enough to haul them to your work site and drop off the materials at your customers location. In essence, this is the same position a contractor would in a commercial construction job.
To make things easy, I have put together a set of tips on how to set up a woodworking business. Picking a location is one of the first, most important decisions you will have to make. Depending on where you live, you may discover that there are a number of people giving you work to do. The more work you have the more money you will make.
When picking out a location, try to find an area that is close to a public area like a school, church, or shopping mall. The more people that are traveling to your job location, the more money you are making. Keep in mind that if people don’t travel to your shop then you won’t be making a big deal out of your location.
So, how do you set up your business? The first thing you need to do is get some insurance in place to cover your business. The easiest and smartest way to do this is to simply go and get a personal liability insurance policy and don’t ever use your workrawour company.
Believe it or not, some of the companies out there won’t need you to carry adequate insurance on your high dollar equipment. So, what you are going to need to protect your investment is a commercial portion of insurance. This should be roughly at least 1 place in your home with insurance. Before you purchase anything from a commercial insurer, make sure they have a business license.
Also, make sure you hire someone who represents the company you are opens a branch of. If this is all you are doing, it will look as though you are running your own branch of the company, which is not exactly how you want to deal with an office building and commercial space. To make sure you don’t appear to make a lot of money with it you must get a license to host your woodworking business.
Also, although this isn’t really needed at this point, the advice I am about to give you is important, also. Don’t go crazy with your pricing — unless you have to. If you are open to the public and only charge your customers what you are worth, you will lose customers. Although this doesn’t sound much, every little bit helps. In reality, the mark up on the supplies will be smallest, because you are selling them a kit or prebuilt, and not an entire kit or prebuilt, but you still need to price them and this way you will have a figure to work with.
Another good idea is to have a set adoption count that not only covers the materials and labor costs, but also contributes to some percentage for profits. This will ensure the very next person who buys from you that another person won’t have the same thing on their jobsite and will be able to stay for that job. This could be a good way to stay in business.
The next step, to ensure profits, is to look at your location and grass. You may want to maintain it for yourself as you don’t want to get stuck with grass that falls apart because you constantly moved it around too much.
Also, you may want to purchase a cheap set of tools in anticipation of having to buy some replacement pieces or parts.
In conclusion, as building your own business equipped with these tips should be a pretty easy process, you always have a constant supply of good ideas to assist you in making your woodworking business grow.