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No profit margin


DAB

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7 hours ago, CharlieL said:

I wouldn't be so sure that the woodworker really got his price. More then likely he settled on a price.

And the shop keeper has higher risk than the woodworker who is cranking items out of their garage shop. The shop keeper, has a full fledged business, permits, overhead, rents, insurance, advertising, location, employees, scheduling, covering for employees who call in sick, long hours, OSHA inspections, local code enforcement inspections, fire department inspections, alarm systems, stress, making payroll, and much more, than that woodworker who is making items to sell at wholesale to the shop keeper.

 

On that note, I'll take the woodworker's spot any day in this relationship. Sure the woodworker sells his turned bowl to the shop keeper for 30 bucks, then shopkeeper sells the bowl for 200, sounds fair to me, considering all the overhead the shop keeper has to deal with. And on top of all that overhead, we can't forget the shopkeeper must make a profit, he/she, has to live and support a family.

 

If that woodworker doesn't like selling their bowls to the shop keeper for 30 bucks, then they need to find another retailer to work with, or find another business to venture in.

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9 minutes ago, HandyDan said:

The woodworker could retail his own bowls and keep all the money.  How hard can it be?:rolleyes:

Exactly! Now the discussion makes a complete 360 circle, and backs up to the original statement, no profit. Now the woodworker must act as the maker, and shopkeeper.

 

But the statement I made above, was in reply to Dab's statement that a shopkeeper has low risk, that could not any further than reality.

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1 hour ago, John Morris said:

Exactly! Now the discussion makes a complete 360 circle, and backs up to the original statement, no profit. Now the woodworker must act as the maker, and shopkeeper.

 

But the statement I made above, was in reply to Dab's statement that a shopkeeper has low risk, that could not any further than reality.

That can be interpreted several different ways, John, if you take on the business end and marketing plus the manufacturering, you are going to make a lot of mistakes on both. While you are working on something your mind will be on marketing and bookkeeping and when you are selling you are worried about the time you are loosing in the shop. It might work for a hobby, but not for a living.

Herb

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Todd clippinger, of The American Craftsman Workshop, has some very interesting and informative YouTube interviews with successful one man woodworking business owners. 

There are some real nuggets of wisdom in the interviews.

Here is one interview. Hopefully you can get to the others from here.

 

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6 hours ago, Dadio said:

That can be interpreted several different ways, John, if you take on the business end and marketing plus the manufacturering, you are going to make a lot of mistakes on both. While you are working on something your mind will be on marketing and bookkeeping and when you are selling you are worried about the time you are loosing in the shop. It might work for a hobby, but not for a living.

Herb

 

I must respectfully disagree with ya Herb, it does work if you got what it takes to operate that way, because successful small shops do just as you described, you gotta be a great multitasker, it's not for everyone, but they do it!

Just off the top of my head this morning, I know of a couple of woodworkers who are neck deep in their work, and they run the business end of it too. I personally know a few of these folks and they are happy, successful, and making a living.

 

Meet Doucette and Wolfe, a small, and very successful shop.

http://www.doucetteandwolfefurniture.com/Home_Page.html

 

Also, my own friend, Russ Filbeck, he raised a family with his woodworking business

http://www.russfilbeck.net/

 

Also, Curtis Buchanan, also makes a living, a career, with his woodworking and has for decades

http://www.curtisbuchananchairmaker.com/

 

These are a just a few examples of successful business's, I could fill this page up with success, but what we need to understand is that you have to have a product people want, you have to have the craftsmanship that folks desire, and you have to have the skill set to run your business, and be salesman at the same time.

It's not for everyone for sure, it's not for me, too scary with a family and a great retirement I already have coming up, perhaps after I retire I don't know. I get the apprehension around here, what I don't get is the blanket statements that everyone is throwing around saying it's not possible, or it'll never work and so on. It does work, they do it, and there are many success stories.

 

Whew! Too much typing this early Herb!:lol: I guess I just feel positive about the whole thing, I don't see it as impossible, I am surrounded by too many examples that show me the opposite of what you all are stating here in this topic. I see success in most of the interactions I have with woodworkers who are business owners.

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11 hours ago, John Morris said:

Sure the woodworker sells his turned bowl to the shop keeper for 30 bucks, then shopkeeper sells the bowl for 200, sounds fair to me, considering all the overhead the shop keeper has to deal with. And on top of all that overhead, we can't forget the shopkeeper must make a profit, he/she, has to live and support a family.

 

If that woodworker doesn't like selling their bowls to the shop keeper for 30 bucks, then they need to find another retailer to work with, or find another business to venture in.

How is that fair ? Did you forget about the investment in tools and machinery, plus the upkeep on all of them. The dangerous and unhealthy work environment that woodworkers work in ? The time it takes to plan out and do custom work. Does the woodworker not deserve to make a respectable profit to live and support a family ? If not, then woodworking obviously becomes less attractive to people, and the consumer will have less choices.

Edited by CharlieL
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25 minutes ago, CharlieL said:

How is that fair ? Did you forget about the investment in tools and machinery, plus the upkeep on all of  them. The dangerous and unhealthy work environment that woodworkers work in ? Also, most woodworking that we all do is custom work and not mass produced with cheap labor. Does the woodworker not need to make a respectable profit to live and support a family ? 

Yes, on all of it. You are correct regarding the Woodworkers obligations. But you are making it sound as if the Woodworker is a victim. Since I don't prescribe to a victim philosophy, we are all free to make choices, if the Woodworker is selling their bowls and selling them at 30, that is not the shopkeepers fault.

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22 minutes ago, John Morris said:

Yes, on all of it. You are correct regarding the Woodworkers obligations. But you are making it sound as if the Woodworker is a victim. Since I don't prescribe to a victim philosophy, we are all free to make choices, if the Woodworker is selling their bowls and selling them at 30, that is not the shopkeepers fault.

Gotta luv the support in this country for the blue collar workers that made this country what it WAS. It's not hard to see why Delta sold out, and is now a small fraction of what it use to be. 

Edited by CharlieL
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Just now, CharlieL said:

Gotta luv the support in this country for the blue collar workers that made this country what it WAS.

You bet ya. I'd call that shop keeper a blue collar worker as well my friend.

You know, it's called capitalism, the market will provide what it can bear. 

Charlie, I think all in all we are all on the same side, and we are actually supporting the same ideas here, but just presenting them differently at this point. 

Since this topic spun off in the direction it did, I believe we are all talking in circles now. 

I'm done here, so the last words belong to our highly valued membership here. 

Thanks guys for putting up with my unpopular rebuttal commentary here. 

Thanks so much for making our community a part of your day!!!!:)

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since i started this, i'll offer one more comment.

 

a large part of what i enjoy about woodworking is my interaction with people i make things for.  our discussions on what they would like, or me surprising someone with something they didn't know was being made.

 

if i was just cranking out work blindly, not knowing who was getting it, and they not knowing who made it, that would reduce me to an assembly line worker, not someone who puts his heart and soul and imagination into each piece.  as i've posted before, most of my work is given away to people i know and like.  i've never had a harsh word from anyone.  some send $$$, and that is always appreciated.

 

maybe i should get a new branding iron:  "made just for ___________" and write in their name.

 

later gents.

 

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2 hours ago, Dadio said:

I appreciate your comments and positive attitude of this subject,John, there are exceptions for sure,but I think the above statement sums it up. I also fall into this category.

Also "family time" was not discussed yet, and of those that do succeed do have to have help either in the shop or on the business end ,either volunteer or otherwise.

I do woodworking for enjoyment and If someone likes what I do I give it to them, and if I make something that doesn't come out right in my eyes, I find someone who likes it and give it them. Some things come out so good in my eyes, that I never get tired of seeing them, I keep for myself,HAHAHA 

I was fortunate I had a job I loved and paid good, had a adequate retirement, and benefits, and I never once said "I built that", because there were a lot of people involved in the project and I just worked there.

Herb

I do admire the time the retired folks get to spend in their shops! I am jealous!:D

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Of the retail clients that I've had:

  • One has been in business since 1929 and is still going, as far as I know, at low level
  • One went from one store to 4, now back to 1  (staff from their closed stores went to another store en mass, and now they're out of business)  And while the stores were failing, often the commission only sales reps made zero money in some months.
  • One went out of business and started selling pianos
  • One was a franchise, owner went bankrupt, taken over by the franchisor, sold to another franchisee, now out of business
  • One went out of business, went back into business a couple of years later, then back out of business in 4 years
  • One out of business, selling lease to business just above
  • One out of business as a franchisee, started an independent store, went out of business, sold inventory to father, and same crew moved to new location a few months later.

Average time between opening and closing was less than 5 years.

 

So, in the 12 years I was doing retail work,

  • Two continued on.
  • Eleven went out of business, one of which sold inventory
  • One went bankrupt and out of business

 

2 of 12 or 16.6% survived beyond 5 years, i.e., 83.3% failure rate.

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Glad you survived, Keith.  Like you point out,it is not for every one. In my early years working construction, I worked for several that didn't make it. One that got 3 weeks behind in my pay,I had to quit to get my money. When I went to his house to pick it up he invited me in ,and there wasn't a stick of furniture in his house and his wife was standing there with a new born baby in her arms. Talk about a guilt trip I went through.

 

Herb

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