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Starting a shop

3K views 39 replies 26 participants last post by  lowrider 
#1 ·
This is something I've dreamed about with some of my friends for quite a while, but I'm wondering exactly how realistic it is. I just got a call from one of my college buddies and He's movin down here soon. While we were talkin we got on the subject of fabrication, and starting a shop. Basically it would be Me and 2 of my friends,

Alex, moving to San Diego soon, Awsome at body work, Currently works at a hotrod shop doing custom paint and body. also knows chevys quite well, mostly muscle cars

Josh, knows fords real well, mostly muscle cars, has a solid understanding of mechanics and cars/trucks in general.

Me, Know how engines work, basic to moderate mechanics skill (built my own suspension, engine swap, etc.) Fairly solid fab skills. I'm no Bob Roggy, but i can build brackets, and have a real good knowledge of proper ways to build things, more towards the 4x4 realm. I know suspensions better than the other 2 and spend way too much time here learning.

I'm the only one with real fabrication experience, but they could learn and like workin on shit as much as I do. I'm just wondering what it would really take for us to get a shop up and running. With the mix of knowledge we could really work on just about anything, tho I'm leaning towards cages, and 4x4 suspensions, etc. I own a welder, chop saw, grinder, etc. and we all own plenty of tools. Basically all we would need is a bender, notcher, and a place to work and we could be building some cool shit.

What i'm wondering is what are all the things you dont think about when starting a shop. Extra costs, Rent, Insurance, Liability, etc. How much money are we really gonna need to get something like this moving, and do you think there is really a need in the San Diego area? I've got a good job right now, and If we were gonna do this I would probably keep my job and just reduce my hours to work in the afternoons at the shop until we either get going enough to do it full time, or we fail miserably. Also what do you guys think is the best way to get the word out about our shop, if we do it? I'm thinkin it would be sweet to build a tube buggy similar to toyfamilys and go out and compete. What better way to show our skills right? Only problem with that plan is we would have to shell out a bunch of cash to build it and run it competitively. I'd really love to do this, It would be like my dream job if i could live on it, but I'm not sure we could pull it off. I'm only 20 and my buddies are 21, and none of us have a lot of money, we do however all have a passion for motorsports and love to work on stuff. I think that and dedication to good customer service goes a long way, but without $$$ your still nowhere.

Dallas
 
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#2 ·
if you all got tools and Auto related hobbies, find a shop to rent that is cheap to store your tools, rides, and get a bender, etc...

this alone split between 3 will be not so expensize and fun, and allow you to build your rigs and practice...you will hook up with people who want buildups done...get thier money and go from there..

this is the beswt way unless you wanna jump right in and get a 30k loan and get stress and shit
 
#3 ·
With the backgrounds of your buddies I would agree with Austin. Try to make rent for a while, then expand. At first just do it without a business license only for yourselves. Think in terms of the fact you can always sell the Camaro's, Mustangs, Blazers and Bronco's you guys find a good deal on and fix up. That's pretty much where I started.

If you want to here about the other side of things and hear about buying an existing business and spending very well into the 6 figures I could telll you about that but it isn't pretty. (yet) :flipoff2:
 
#4 ·
well I am in the mid stage of having a full blown shop. I have the shop. I have all the tools and toys. I have all the $$$$ covered no prob but I have yet to let the govt. know :D I'll make it real after I graduate. but all my work is done under the signing of no $$$ tendered. and I only do work for people that I know or are referred by a good friend. and I am booked through february!
 
#5 ·
I've been looking into a similar venture myself, and I've come to the conclusion that the shit ain't cheap. Especially for the tools and space you might need. While doing fab work is a good idea, not everyone is going to want a custom built suspension. Some of the customers are simply going to want an off-the-shelf lift kit. No muss, no fuss, and no huge expense for them. The hardest (if you're wanting to sell parts,etc as well as build) is deciding what products you're going to carry, yadda yadda yadda.

This could go on all day, but pretty much what everyone else is saying are also good ideas...

JParuBob
 
#7 ·
that would be a wonderful job... a few of my friends are wrenchmen down a t a a dealership..... I go to see them and almost get jealous they get to work on cars and trucks all day an dI am going to school.... I like school, but I would love to get a real good fab/4x4 shop someday.... I say rent a place... start out doing it for cheaper just to get the people and the buisnes.. then expand.... GOOD LUCK and go for it!!!!
 
#8 ·
shoot if you're in no rush make a reputation for yourself doing more personal jobs for friends and their friends and acquaintences and their aquaintences etc.. NETWORKING is the key to business.. then everyone will know you as that one dude who used to help everyone out and do a good job.. then you'll have a reputation and people will reccomend you
 
#9 ·
Well... where to start... I have been trying to get a 4x4 shop off the ground for quite some time (better than 2 years). The hardest part is the $$$. Well first off not only does a shop need good mechanics and fabercators but it also needs exellent book keeping, good customers, and above all somebody who will run it 18 hours a day 7 days a week. You have to be willing put alot aside to be sucessful. The biggest thing for me lately has been the wheeling time. I was so involved with the business and trying to make it happen that i forgot the real reason i started it in the first place.... to wheel more and to work at something i love doing. It started becoming a chore. I finally woke up one day and decieded that i would go back to the basics and do what i really enjoyed doing... wheeling. No i am giving up the idea i am just giving it a rest to make sure that is what i really want to do. My suggestion is to talk to other business owner. Not just people who own 4x4 shops but any sort of business. Get some understanding of what they do and how they like it. Oh and the thing of working full time and doing something on the side gets old real quick. You start to run out of time to do everything you really want to do.

Before you start...Buy a book on running a small business ( I really do have Small business mangemnt for dummies and Business plans for dummies. Don't laugh they have very good info) The very first thing you do is put together a list of ideas of what you want to do and how you think you will accomplish it . Then you put togher a list of things you will need for the busines (eg. building, tools, supplies, and don't for get the small things like toilet paper) Then put a cost to every item. Then add them all up. Next double the amount. This is what it will cost you to start your business, realistically. Now put toghter a list of things you will sell and for how much. Then cut the amount in half. This how much, realistically you will make. belive it or not this how banks review loan applications for businesses. If you like the out come of the numbers than you should have no problem with $$$ to start. Also check out www.sba.org. This will help you out temedously! It is by far no picnic in the park but if you succed you will be very happy in the end.. well good luck and feel free to e-mail or pm if you have any questions..... Oh and just to let you know when i put together my spred sheet with my numbers it was going to cost me $125K just to start a full blown 4x4 shop. That only includes the first and last months rent.
 
#10 ·
Very well said drnut. I too have contiplated this, but in my corner, I also have a family with 2 kids, Its hard enough to get out to wheel with the side jobs/rigs I am building now, and if i was to go full time, my overhead just jumped thru the roof(unless the wife could make as much as i did at my full time job). ANd also, as Drnut stated, when a hobby becomes a job, it loose's its "hobbyness" and turns into a job, kinda looses its spark so to speak..
 
#11 ·
drnut and crash bring up good points.

So, OK, this is from a born and raised jack of all trades business man ...

The partner deal is a just plain bad way to go as it rarely works out.
It won't hurt you to rent a place and you guys try it out though.
That will give you some experience and a better idea what it would be like to be partners.

Keep good records.
Even in a small, three man shop the money gets mixed up quickly.
Share common costs but keep things like tool purchases seperate so if you do split up there won't be fights as to what is who's.
And believe me, sooner or later, one of you will ask, "Where did the money go?"

I to am a slave to my business and it does interfere with wrenching and wheeling time. But that's life.
Most (any kind of) shop owners will tell you the same thing.

Anyone who can make a living from something he loves is a lucky SOB.
Be prepaired to go it alone and work your butt off to make it happen.

Always over estimate a job quote and the time it will take to get it done. Give yourself some room.
Each job will usually take longer and cost more any way and customers are rarely unhappy for the job finished early and getting a bill for less than estimated.

Always get prior approval before doing additional work.

Treat your customers fairly but don't cave in to unreasonable demands. You can't afford it.

Lastly ...

CARVE THESE WORDS IN STONE :p
 
#12 ·
I can attest that working a Full time job, and trying to run your own business is tough, and will get tiresome quickly. You will start feeling that all you do is work, drive to / from work, and worry about work. Its even tougher if you have a family. Thats where im stuck at now. Dont have much initial $$$ on hand, really cant afford to lose my benefits, and im already worn out from working 2 jobs for so long.

I think the idea of just renting the shop, doin some jobs here and there is great. You also need to think long term. Taxes, insurance, Taxes, retiremetn, Taxes...Plan ahead, and keep all major expenses separate from your buddies. Thats gonna be a headache all in its own. Get estimates for work down on paper! Many good points made on this thread...
 
#13 · (Edited)
I would highly recomend contacting the Small Buisness Administration. The amount of information those folks have is incredable. They ave free classes on starting a buisness. Also, I hope you are really good friends, because odds are you won't be after trying to start a buisness together.
 
#14 ·
I would imagine a lot of people on this board have dreamed about running a shop at one time or another, I know I have.

My plan is to take it slowly, very slowly. Right now I just have a small garage at my rental house, haven't even done any work for money, just beer, food, or trades. But that's a great way to get a customer base started. Now I'm looking to buy a larger house, in an un-incorporated area, with a few acres, where I can put up a nice shop, and expand a little. I still work my day job, and probably will for at least another 5 to 10 years. If it doesn't work out, or I find I can't make any money at it, I'll still have a nice shop for working on my own junk, on the other hand, if it does work, it would be a great way to semi-retire at the age or 40 or so.


Another thing might be finding a nitch to fill. It seems that alot of the most profitable companies in this buisness specialize in certain things. Maybe suspensions, or axles, or cages. It's not what I plan to do, but it might be the way to be the most successful.

chad
 
#16 ·
One thing I can tell you: If you go legit in CA, Paint will be a nightmare.

You can paint, just don't publicly advertise that as a service. Build a little paint booth, and don't do it out in the open.

You don't wanna know....:mad:

Jim
 
#17 ·
Thanks a lot for all the great suggestions guys, they really do help. Last night I went over to Josh's house and we discussed the plan for a while. I think we decided that if we were gonna do it it would just be the 2 of us. Reason being Josh doesn't even know Alex, and I already have doubts about how long i could work with him without getting into fights. Josh and I have been very good friends for a number of years and i feel much more comfortable being partners with him. Hes one of those friends you can hang out with for a month straight and never get on each others nerves, if you know what i mean. As far as book keeping, I'm fairly good with numbers and my mom is a CPA and spends all day doin the books for million dollar companies, so i think i'll have some help :D.

So far here is our plan.
1. Save some cash and start doin research and getting ready
2. Rent a space in an industrial complex (we have one in mind but there are many near Josh) to start i'm thinkin something with enough space for a shop area with benches and space for 1-2 vehicles.
3. Get our buddy to set up a nice web site, for a bit more exposure.
4. Use the vehicles we have access to (ranger, explorer, 1st and 2nd gen amigo, etc) to build some tube bumpers, and other bolt on stuff thats easy to sell to generate cash and build a name.
5. Once we get moving a little we can start doing custom work for customers and go from there.

Any comments?

Once Josh gets his mustang running we can slap some decals on it and use it as advertising at the local tracks, as well as our buddies truck. Once we get moving Josh and i wanna build a rock buggy and start competing so we can use that for advertising as well.

At the moment we both have full time jobs, but i know i can cut down my hours so that i'm only working until 1 or 2pm and then i can go work at the shop, and I'm pretty sure Josh can do the same. Once we get going, if we can make money, I can quit my current job, but until then i need to keep my steady paycheck.

A couple questions. Sillyneck, how did you build up buisiness? I know your on here a lot, and i'm assuming you know people, but did you do any sort of advertising? Basically the things we are worried most about right now is the cost of starting up the shop, and getting customers.

As for fun turning into work, i definitely hear ya, but i really do love this stuff. Ever since i finished all the major work on my truck i've been dying to start some new projects. I think I had more fun building the truck than wheeling it





















:laughing: :laughing: :laughing: :flipoff2: :flipoff2: yeah.....right. Wheeling is still better.

Dallas
 
#19 ·
My plan is to take it slowly, very slowly. Right now I just have a small garage at my rental house, haven't even done any work for money, just beer, food, or trades. But that's a great way to get a customer base started.
This is a double edged sword. I have done exactly what you are doing, only I did it with Mustangs. I do stuff like weld in roll bars/cages, swap gears, fabricate misc parts (firewalls, battery mounts/relocations, etc), do install work, and even do some major projects such as converting the new Mustangs (1999-present) to a return style fuel system, or engine rebuilds.

The dilemma occurs because you are helping "friends". Now when you want to start charging people to do work, they become upset. "Well, you installed the *insert part here* for free" or "Well, you welded in xxx's cage for $yyy, why is it so much mroe for me?" Believe me, if I had to do it over again, I either would charge ALOT to do stuff from the beginning, or I wouldn't bother doing it. It will end up not being worth your time to let someone's car sit in your garage for a week so you can fabricate and install stuff for free, because they are a "buddy".

Now, it's a double edged sword because YOU HAVE to do the above, to make a name for yourself. Not many people are going to be willing to pay someone with no previous work portfolio to do something to their car/truck/whatever. If you can say "yeah, I built the 10 pt roll cage, firewall, and fuel cell mounts, in xxx's car, and it passed NHRA certification for 9.99-7.50 on the first inspection", then it holds alot more weight. Of course it helps if your customer knows the car in question.

I also have picked up some dealerships from shops that manufacture parts for Mustangs. I typically sell parts for a good price, but even then, your "buddy's" will be POed if you want to mark up a part $20 over wholesale, even though they are saving $50 relative to retail.

The problem is, people in this type of hobby are inherently cheap, and they think thier time is worth more than yours, granted, I'd the one with $50k worth of tools, and all they own is a small 99 piece Craftsman hand tool set. People typically refuse to accept the fact that they are getting a deal, they typically want to pay NO profit, not even a couple bucks.

Sorry, I guess I'm ranting. However, this will happen to anyone who wants to go down this path.
 
#20 ·
Jared Rude said:

Now, it's a double edged sword because YOU HAVE to do the above, to make a name for yourself. Not many people are going to be willing to pay someone with no previous work portfolio to do something to their car/truck/whatever. If you can say "yeah, I built the 10 pt roll cage, firewall, and fuel cell mounts, in xxx's car, and it passed NHRA certification for 9.99-7.50 on the first inspection", then it holds alot more weight. Of course it helps if your customer knows the car in question.
I think this is a good argument for building a competition rockcrawler (or two ;) ) for "the company" as advertisement, and so customers can see what kind of work you do, and if they feel comfortable with you doing that type of work on their rig. If they still don't, you don't want to do business with them anyway.
 
#21 ·
Cliffhanger said:


I think this is a good argument for building a competition rockcrawler (or two ;) ) for "the company" as advertisement, and so customers can see what kind of work you do, and if they feel comfortable with you doing that type of work on their rig. If they still don't, you don't want to do business with them anyway.
I run a small CNC shop here in Central WA, and I am thinking of doing this, only with my Flatfender. We are a production shop, but with the economic impact of Sept 11th (WA is #2 in economic impact from Sept 11 next to NY) the work load is gone, as in there is none. So I figure why not try to do something in line with what I love to do?

So the path I want to take the shop is to make parts for those who have the ability to build their own rigs, but don't have access to a machine shop. I am thinking along the lines of narrowing housings, threaded tubing adapters, brackets, braces, tube bending or bender rental, custom powersteering pulleys, ect... Stuff the average gargage fabricator has a tough time doing.

I am thinking of advertising in some national magazines, but the shop may not be here by the time the ad runs-anyone see the ad for the "Stolen Bruiser" a month after it was recoverd? :D
 
#23 ·
Get together a business plan and agreement!

I was working on doing this exact same thing not too long ago. A buddy of mine was going to front the cash, and I was going to bring in the fabrication and clientele I already had. The day before he was supposed to get his money, he disappeared. That was the last Thursday of June, and I've never heard from him since. As much of a friend as he may be, you both should sign a business agreement between you two, basically stating that neither will sue the other if the business should happen to fail for whatever reason. It's not meant to split you guys up as friends, but to help cover each other's butts. If he's a real friend, he'll understand and won't be offended

luckily for my 'buddy', we never got around to signing the agreement, so when he disappeared, it's just as if the money was never there to begin with(and he was going to have ALOT to put into the business too)

I'm still working on doing this on my own, so good luck to you!:)
 
#24 ·
I think this is a good argument for building a competition rockcrawler (or two ) for "the company" as advertisement, and so customers can see what kind of work you do, and if they feel comfortable with you doing that type of work on their rig. If they still don't, you don't want to do business with them anyway.
I agree. Also, it wouldn't really make a difference if you won. All you would need is the magazine coverage, and a small magazine add near that coverage. There is a direct correlation between magazine coverage/advertisements and sales/workload.
 
#25 ·
Cliffhanger said:


I think this is a good argument for building a competition rockcrawler (or two ;) ) for "the company" as advertisement, and so customers can see what kind of work you do, and if they feel comfortable with you doing that type of work on their rig. If they still don't, you don't want to do business with them anyway.
Yep, let the work speak for itself. Plus if its a shop rig it will always be around to show potential customers, unlike a customer rig that you only have pictures of.

As for doin muscle cars, of course we will. I love muscle cars too, and I'll work on anything. Hell i'll even build a cage for some little ricer if he wants to pay me for it. We aren't gonna limit our customer base to anything.

Dallas
 
#26 ·
Jared Rude said:


I agree. Also, it wouldn't really make a difference if you won. All you would need is the magazine coverage, and a small magazine add near that coverage. There is a direct correlation between magazine coverage/advertisements and sales/workload.
This is exactly what i was thinking, you dont have to win, you just have to compete. If the rig looks good and wheels people will take pics whether its for mags or just spectators. but those pics will end up on here and lots of other sites, which brings exposure.

Dallas
 
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